How to Get Government Security Contracts: Complete Guide for Security Companies 2026

If you provide security services - armed or unarmed guard services, access control, surveillance, cybersecurity, investigative services - government agencies need your capabilities. Federal, state, and local governments spend over $20 billion annually on security contracts, and this market is growing as threats evolve and facilities expand.

Unlike commercial security contracts where you compete on price alone, government security contracting rewards reliability, compliance, and specialized capabilities. Contracts are multi-year (1-5 years), payment is reliable (30-60 days), and performance builds a track record that compounds over time.

Market Reality Check

Government security contracting is more accessible than most security contractors realize:

• No prior government experience required (commercial security experience counts)


• Contracts range from $25K (small facility guard services) to $50M+ (multi-facility, multi-year)


• 40-50% of security contracts are small business set-asides


• First contract typically won within 6-12 months of serious pursuit


• Past performance from first contract unlocks larger opportunities

Who This Guide Is For

This guide is designed for:

• Security companies pursuing federal, state, or local government contracts


• Armed guard service providers targeting secure facilities


• Unarmed guard companies targeting office buildings, schools, medical facilities


• Security system integrators (access control, CCTV, intrusion detection)


• Cybersecurity firms (this guide focuses on physical security; see IT government contracts for cyber)

What You Will Learn

By the end of this guide, you will understand:

• Where the $20B+ annual security spending is concentrated (agencies, contract types)


• NAICS codes for security services and how to position your company


• Licensing, insurance, and certification requirements (state-specific and federal)


• Step-by-step roadmap from SAM.gov registration to first contract award


• Bid strategies, pricing approaches, and common mistakes to avoid

Let us dive in.

Understanding where government security dollars are spent helps you target efforts strategically. Security spending is distributed across federal, state, and local governments with different priorities and procurement processes.

Federal Security Spending by Agency ($20B+ annually)

| Agency | Annual Security Spend | Primary Security Needs | Contract Types |
|--------|----------------------|----------------------|----------------|
| Department of Defense (DoD) | $8-10B | Armed guard services, base security, classified facilities, overseas security | Multi-year IDIQs, base-specific contracts, OCONUS |
| Department of Homeland Security (DHS) | $3-4B | Federal building security (FPS), border security, detention facilities, critical infrastructure | FPS contracts (guards at federal buildings), ICE/CBP facilities |
| Department of Veterans Affairs (VA) | $1.5-2B | Medical center security, parking enforcement, visitor screening, emergency response | Medical center contracts, police services, unarmed guards |
| General Services Administration (GSA) | $1-1.5B | Federal building security (complementing FPS), access control systems, surveillance | GSA Schedule 84 (security), facility-specific contracts |
| Department of Energy (DOE) | $1-1.5B | Nuclear facility security, armed protective forces, classified site security | Specialized armed security, high security clearances |
| Department of Justice (DOJ) | $800M-1B | Federal prison security, courthouse security, witness protection, investigative support | BOP facilities, US Marshals support, courthouse contracts |
| Department of State | $500-800M | Embassy security (mostly overseas), passport facilities, diplomatic security support | Overseas contracts, domestic passport centers |
| NASA | $300-500M | Facility security, launch site security, access control, classified program protection | Kennedy Space Center, JSC, other NASA centers |
| All Other Federal | $2-3B | Security across 100+ agencies, office buildings, research facilities, warehouses | Diverse opportunities, smaller contracts |

State and Local Security Spending ($8-12B annually)

State and local governments spend heavily on security but procurement is decentralized:

• State buildings: Capitol complexes, office buildings, DMV locations ($2-3B)


• Schools and universities: School resource officers, campus security, event security ($3-4B)


• Courthouses and jails: Court security, detention facility guards, inmate transport ($2-3B)


• Public transit: Bus/rail security, station security, surveillance monitoring ($1-2B)


• Parks and recreation: Park rangers, beach patrol, facility security ($500M-1B)

Security Contract Sizes by Opportunity Type

Understanding contract sizes helps you target appropriate opportunities:

Small Contracts ($25K-$150K annually)

• Single facility unarmed guard services (one 40-hour post)


• Part-time security (weekends, nights, special events)


• Small federal office buildings, VA clinics, research facilities


• Good for first government contract (low competition, manageable scope)

Medium Contracts ($150K-$1M annually)

• Multi-post guard services (2-5 security officers)


• Mid-size federal buildings, state office complexes, university campuses


• Armed guard services for secure facilities


• Access control and visitor management systems

Large Contracts ($1M-$10M annually)

• Multi-facility guard services (10-50 security officers)


• Major federal installations (military bases, VA medical centers, federal courthouses)


• Multi-year blanket contracts with task orders


• Require past performance, bonding, significant staff capacity

Enterprise Contracts ($10M+ annually)

• National or regional IDIQ contracts (Department of Defense, FPS, VA)


• Multi-site, multi-year with hundreds of security officers


• Typically awarded to large national security companies or joint ventures


• Not recommended for contractors without significant government track record

Strategic Recommendation: Target $50K-$250K contracts for your first 1-2 government wins. This range is large enough to build meaningful past performance but small enough to minimize risk, bonding requirements, and competition from national firms.

NAICS Codes for Security Services

Your NAICS code determines contract eligibility and size standards. Security services fall under several codes:

| NAICS Code | Description | Size Standard | When to Use |
|------------|-------------|---------------|-------------|
| 561612 | Security Guards and Patrol Services | $22M revenue | Unarmed guard services, patrol services, access control |
| 561613 | Armored Car Services | $22M revenue | Cash/valuables transport (niche, rarely used for facility security) |
| 561621 | Security Systems Services (except Locksmiths) | $22M revenue | Installation, monitoring, maintenance of security systems (CCTV, access control, alarms) |
| 541690 | Other Scientific and Technical Consulting Services | $19M revenue | Security consulting, threat assessments, security planning (not guard services) |

Primary Code Strategy: Most security contractors should use 561612 as primary code (covers broadest range of guard service contracts). Security system integrators should use 561621. Contractors offering both should list both codes in SAM.gov, with primary code based on which represents majority of revenue.

Hot Security Categories for 2026-2030

Federal security priorities are shifting based on evolving threats:

• Cybersecurity for physical systems: Securing access control, CCTV, and building automation systems from cyber threats


• Active threat response: Training and protocols for active shooter, terrorism, civil unrest


• Technology integration: AI-powered surveillance, facial recognition, drone detection, advanced analytics


• Classified facility security: Increasing demand for SECRET/TOP SECRET cleared security personnel


• Medical facility security: Growing VA and HHS security needs as facilities expand


• Critical infrastructure protection: Power plants, water treatment, transportation hubs

Understanding these priorities helps you position capabilities and pursue high-demand contracts.

Government security contracts have strict licensing, insurance, and compliance requirements that vary by contract type and location. Understanding these upfront prevents wasted effort bidding on contracts you cannot legally perform.

State Security Licenses (Required)

Every state regulates security services differently. You MUST hold appropriate state licenses for the state where services are performed:

Unarmed Security License Requirements (varies by state)

• Company license: Business entity registration, liability insurance, background checks


• Individual guard licenses: Fingerprinting, background check, training (8-40 hours depending on state)


• Renewal: Annual or biennial, continuing education requirements in some states


• Training: Pre-assignment (8-16 hours), firearms (if armed), specialized (medical facilities, schools)

Armed Security License Requirements (more stringent)

• All unarmed requirements PLUS:


• Firearms training: 16-40 hours classroom and range qualification


• Annual requalification: Range qualification, continuing education


• Background checks: More extensive than unarmed (felony restrictions, domestic violence)


• Weapons permits: Varies by state (carry permits, exposed firearms permits)

State-by-State Variations (examples)

| State | Company License | Guard License | Armed Requirements | Notes |
|-------|----------------|---------------|-------------------|-------|
| California | BSIS license | Guard Card (exposed/concealed) | Firearms permit, 14-hour firearms course | Strict regulations, reciprocity limited |
| Texas | Private Security Bureau license | Level II/III/IV based on role | Level III/IV for armed, 30-hour course | Reciprocity with some states |
| Florida | Class B/MB/M license | D/G license | G license for armed, firearms course | Separate statewide firearms license |
| Virginia | DCJS license | Registration | Firearms endorsement, training, qualification | Strict armed guard requirements |
| New York | DOS license | 8-hour pre-assignment, 16-hour on-the-job | 47-hour firearms course | Most stringent in nation |

Federal Contract Licensing Requirements

Federal contracts typically require:

• Valid state license in state where work is performed


• Compliance with state training and background check requirements


• Sometimes federal background checks (for DoD, DOE, federal courthouses)


• Security clearances for classified facilities (SECRET, TOP SECRET)

Insurance Requirements

Government security contracts require higher insurance limits than most commercial contracts:

Minimum Insurance (typical requirements)

• Commercial General Liability (CGL): $1M per occurrence, $2M aggregate


• Workers Compensation: Statutory limits in your state


• Automobile Liability: $1M (if guards use vehicles for patrol or transport)


• Professional Liability: $1M (for security consulting, assessments, or specialized services)


• Umbrella/Excess Liability: $5M-$10M (for large contracts or high-risk facilities)

Higher Limits for Specialized Contracts

• DoD and DOE contracts: $5M-$10M general liability, $5M auto liability


• Armed guard contracts: $2M-$5M general liability (higher liability exposure)


• Multi-facility contracts: $5M+ umbrella coverage

Cost: Security insurance is expensive due to liability exposure. Typical costs:

• $1M/$2M general liability: $8K-$15K annually (unarmed), $15K-$30K (armed)


• Workers comp: 8-15% of payroll (security is high-risk classification)


• Auto liability: $3K-$8K annually


• Umbrella $5M: $5K-$12K annually

Critical: Get insurance quotes BEFORE bidding. Build premiums into your pricing. Winning a contract then discovering you cannot afford required insurance is disastrous.

Compliance Requirements for Government Security Contracts

Beyond licensing and insurance, government security contracts carry compliance obligations:

Background Checks

• Federal contracts: FBI fingerprint background checks for all guards ($25-$50 per person)


• DoD contracts: National Agency Check (NAC) or higher ($100-$300 per person, 30-90 days)


• Schools/medical facilities: State-specific background checks, child abuse clearances, drug testing


• Ongoing: Some contracts require annual re-checks or continuous monitoring

Drug Testing

• Pre-employment drug testing (standard)


• Random drug testing (10-20% of workforce quarterly or annually)


• Post-incident and reasonable suspicion testing


• Cost: $30-$75 per test

Training and Certification

• Contract-specific training (facility orientation, emergency procedures, client-specific protocols)


• Specialized certifications (CPR/First Aid, AED, active shooter response)


• Annual refresher training (use of force, report writing, customer service)


• Firearms training and qualification (armed contracts, annual or semi-annual)

E-Verify (Federal Requirement)

• All federal contractors must use E-Verify to confirm employment eligibility


• Electronic system, free, required within 3 days of hire


• Non-compliance can result in contract termination

Prevailing Wage (Service Contract Act - SCA)

• Applies to most federal service contracts over $2,500


• Must pay Department of Labor prevailing wages for your locality and occupation


• Wages often 30-100% higher than state minimum wage


• Fringe benefits ($4-$8/hour) or cash equivalent required


• Weekly certified payroll reporting (DOL Form WH-347)


• See our construction guide Davis-Bacon section for similar compliance framework

Service Contract Act Example

Washington DC security guard (2026 wage determination):

• Prevailing wage: $22.50/hour (vs $17/hour DC minimum wage)


• Fringe benefits: $5.80/hour (health, vacation, holidays)


• Total compensation: $28.30/hour minimum


• Impact on pricing: Must build SCA wages into your cost estimate or you will lose money

Performance Reporting

• Monthly performance reports (incidents, hours worked, training completed)


• Quarterly compliance certifications (licenses current, insurance valid)


• Annual wage determinations (SCA contracts, update pricing if wages increase)

Clearances for Classified Facility Security

Some government security contracts require security clearances:

When Clearances Are Required

• DoD classified facilities (SECRET or TOP SECRET)


• DOE nuclear facilities (Q or L clearances)


• Intelligence community facilities


• Federal courthouses with classified proceedings

Clearance Levels and Costs

• Confidential: Rarely used for security guards, basic background check


• SECRET: Most common for facility security, tier 3 investigation, $5K-$10K cost, 6-12 months


• TOP SECRET: High-security facilities, tier 5 investigation, $10K-$25K cost, 12-24 months


• Q Clearance (DOE): Nuclear facilities, equivalent to TOP SECRET, 12-24 months

Who Pays for Clearances: Government sponsors and pays for clearances. You cannot self-sponsor. Win the contract first, then your employees undergo clearance process during transition period.

Clearance Challenges for Security Contractors

• Long timelines (6-24 months) delay contract start or require interim clearances


• Not all guards can obtain clearances (financial issues, foreign contacts, criminal history)


• High turnover in security industry makes clearances challenging (clearances do not transfer between employers easily)

Strategy: Do not avoid cleared contracts, but understand timeline and staffing implications. Have backup cleared candidates in case primary does not pass.

Common Compliance Mistakes

Bidding without verifying state license validity in performance state: Federal contract in Maryland requires Maryland security license, not just your home state

Underestimating insurance costs: $30K-$50K annual insurance premiums significantly impact profitability

Ignoring Service Contract Act wages: Bidding commercial wage rates on SCA contract guarantees money loss

Not budgeting for background checks and drug testing: $100-$150 per guard adds up quickly on 20-person contract

Missing training requirements: Contract specifies CPR, First Aid, active shooter training but you bid assuming none

Solution: Create compliance checklist from solicitation. Verify you hold required licenses, can obtain insurance at affordable rates, have calculated SCA wages if applicable, and have budgeted compliance costs. Include all compliance costs in your pricing.

This roadmap assumes you are an established security company with commercial experience, appropriate state licenses, and insurance. If you are just starting a security company, establish commercial track record first (6-12 months minimum) before pursuing government contracts.

Phase 1: Foundation (Weeks 1-4)

Week 1: SAM.gov Registration and Business Structure

Register in SAM.gov (System for Award Management)

- Go to sam.gov and create account - Requires: DUNS number (free from dnb.com), Tax ID (EIN), banking information, NAICS codes - List 561612 (Security Guards) as primary NAICS code - Add 561621 (Security Systems) if you also install/monitor systems - Activation takes 7-10 days - See our SAM.gov registration guide for step-by-step instructions

Verify state licenses are current

- Company license valid for all states where you plan to bid - Individual guard licenses not expired - Renewal dates noted (governments check license validity before award)

Verify insurance meets government minimums

- $1M/$2M general liability (minimum) - Workers comp at statutory limits - $1M auto liability (if guards use vehicles) - Request Certificates of Insurance from agent for future proposals

Week 2: Certifications and Positioning

Apply for small business certifications (if eligible)

- 8(a) Business Development: For disadvantaged businesses, sole-source up to $4M (application: certify.sba.gov) - SDVOSB: For service-disabled veteran-owned businesses, VA contracts prioritize SDVOSB (application: va.gov/osdbu/verification) - WOSB/EDWOSB: For women-owned businesses, EDWOSB has sole-source authority (application: certify.sba.gov) - HUBZone: For businesses in Historically Underutilized Business Zones, 35% of employees must live in HUBZone (application: certify.sba.gov) - Processing time: 30-180 days depending on certification - See our small business certifications guide for complete eligibility and benefits

Identify your target market

- Armed vs unarmed: Armed contracts pay 30-50% more but require firearms licenses, higher insurance, more liability - Federal vs state/local: Federal has more opportunities but more competition; state/local often faster procurement - Geographic focus: Target contracts within 50-100 miles (reduces travel costs, easier supervision) - Facility types: Align with your commercial experience (office buildings, medical facilities, schools, courthouses)

Weeks 3-4: Capability Statement and Market Research

Create capability statement (one-page marketing document)

- Company overview: Name, location, ownership, certifications, years in business - Core competencies: Armed/unarmed guard services, access control, patrol services, specialized capabilities - Past performance: 3-5 commercial security contracts with contract value, scope, customer references - Differentiators: Certifications, technology, training programs, specialized experience - Contact information: Phone, email, website, SAM.gov UEI number - Design: Professional, one page, PDF format - Use to introduce your company to agencies and primes

Research government security opportunities

- SAM.gov: Search for security contracts (NAICS 561612) in your state, filter by contract value ($25K-$250K for first bid) - State procurement portals: Visit your state portal (see state portals) and search for security, guard services - FedBizOpps archive: Historical security contracts show what agencies buy and how often they rebid - Agencies to research: VA medical centers, federal office buildings (GSA), courthouses (GSA/USMS), military installations (DoD), state office complexes

Phase 2: Market Positioning (Months 2-3)

Month 2: Relationship Building

Contact Small Business Specialists at target agencies

- Every federal agency has Office of Small and Disadvantaged Business Utilization (OSDBU) - Find contacts: Agency website OSDBU page or SAM.gov agency listings - Email introduction: Attach capability statement, mention certifications, request forecast/upcoming opportunities - Example email:

Subject: Service-Disabled Veteran-Owned Security Company - Armed/Unarmed Guard Services

Dear [Name],

I am the owner of [Company Name], a service-disabled veteran-owned security company based in [City]. We provide armed and unarmed guard services for federal and commercial facilities.

We recently completed SAM.gov registration (UEI: XXXXXXXXXXXX) and are pursuing government security contracts. Our team has 15 years of commercial security experience serving office buildings, medical facilities, and industrial sites.

Could you share upcoming security contract opportunities or forecasts for [Agency]? I have attached our capability statement for your reference.

I would welcome the opportunity to schedule a brief call to introduce our capabilities.

Thank you,
[Your Name]
[Title]
[Phone]
[Email]

Attend industry days and matchmaking events

- Agencies host "Industry Days" before major contracts to meet potential bidders - APEX Accelerators (free SBA counseling) host matchmaking events connecting small businesses with agencies - Bring capability statements, business cards, and ask questions about upcoming solicitations - Goal: Build relationships so contracting officers recognize your company when you bid

Research subcontracting opportunities

- Large national security companies (Allied Universal, G4S, Securitas) hold multi-million dollar government contracts - They need subcontractors to meet small business subcontracting goals (40-50% of contract value to small businesses) - Find primes: Search sam.gov for large security contracts ($5M+), note who won, contact their Small Business Liaison Officer - Send capability statement, express interest in subcontracting on future contracts

Month 3: Proposal Readiness

Build proposal templates

- Cover letter: Introduction, understanding of requirement, why we are qualified - Technical approach: How you will perform security services, staffing, training, supervision, quality control - Management plan: Supervision structure, communication protocols, reporting - Past performance: 3-5 commercial contracts showing similar scope, customer references - Pricing: Labor categories, hourly rates, markup, total cost breakdown

Gather past performance references

- Contact 3-5 commercial security clients and request permission to use as references - Get: Customer name, title, phone, email, contract value, dates of performance, scope of work - Format as past performance project descriptions (see proposal template)

Calculate labor rates and pricing

- Base hourly cost: Guard wage + payroll taxes (7.65%) + workers comp (8-15% of payroll) + benefits - Overhead: Office, supervision, vehicles, uniforms, equipment (20-35% of labor cost) - Profit: 10-15% for government contracts (lower than commercial 20-30%) - Service Contract Act: If federal contract, use DOL wage determinations, not your commercial rates

Phase 3: First Pursuit (Months 4-6)

Month 4: Identify and Pursue First Opportunity

Find ideal first opportunity

- Contract size: $50K-$150K annually (large enough to matter, small enough to minimize competition) - Scope: Single facility, unarmed guard services (or armed if you have licenses/insurance) - Location: Within 50 miles of your office (easier supervision, lower costs) - Contract type: Firm-fixed-price (you know your costs, minimal risk) - Evaluation: Lowest price technically acceptable OR best value (if you have strong past performance)

Analyze solicitation thoroughly

- Read entire solicitation: Performance Work Statement (PWS), evaluation criteria, wage determinations, compliance requirements - Create compliance matrix: List every requirement, confirm you can meet it, note where it is addressed in proposal - Attend pre-proposal conference: If offered, attend in person or virtually, ask clarifying questions - Conduct site visit: If allowed, visit facility to understand layout, challenges, staffing needs

Weeks 1-2 of Month 4: Proposal Development

Write technical proposal

- Understanding of requirement: Paraphrase PWS to show you understand what agency needs - Technical approach: How you will staff (number of guards, shifts, supervision), train (pre-assignment, ongoing, specialized), and perform (patrol procedures, access control, incident response) - Quality control: How you ensure performance (supervisory visits, inspections, customer communication) - Management plan: Who supervises guards, how you communicate with agency, how you handle issues - Length: 10-20 pages for small contracts, focus on clarity and compliance

Develop pricing

- Calculate fully-burdened hourly rate (wage + taxes + workers comp + benefits + overhead + profit) - If Service Contract Act applies, use DOL wage determination - Build in costs: uniforms, background checks, drug tests, training, supervision, travel - Price to win but maintain 10-15% profit margin (underbidding by 5% to win but losing money is pointless)

Compile past performance

- Use 3-5 commercial security contracts as past performance - Format: Project name, customer, contract value, dates, scope, reference contact info - Emphasize similarities: "Provided armed guard services for 75,000 SF medical facility, similar to this requirement"

Week 3 of Month 4: Proposal Review and Submission

Review proposal for compliance

- Use compliance matrix: every solicitation requirement addressed - Verify you included all required documents (SF-330, SF-1449, certifications, insurance certificates, licenses) - Check formatting, page limits, font sizes - Have someone outside your company read it (APEX Accelerators offer free proposal reviews)

Submit proposal

- Submit 1-3 days before deadline (not last minute in case of technical issues) - Keep copy of submission confirmation - Mark calendar for evaluation period (typically 30-60 days)

Months 5-6: Evaluation and Award

Wait for evaluation (30-90 days)

- Agencies evaluate proposals, conduct reference checks, verify licenses and insurance - You may receive questions or requests for clarification - respond within 24-48 hours - Do not call contracting officer repeatedly asking for status (unprofessional)

If you win: Prepare for contract start

- Background checks: Submit all guard information for FBI fingerprint checks (30-60 days) - Training: Complete contract-specific training, facility orientation - Uniforms and equipment: Order uniforms, radios, flashlights, pepper spray (if authorized) - Staffing: Recruit and hire guards (have backups in case someone fails background check) - Insurance: Provide Certificate of Insurance naming agency as additional insured - Kick-off meeting: Meet with COR (Contracting Officer Representative) to confirm expectations, communication protocols, reporting

If you lose: Request debriefing

- You have right to debriefing explaining why you lost - Ask: What was winning score vs your score? Were there deficiencies in technical or past performance? Was pricing competitive? - Use feedback to improve next proposal - Most contractors lose first 2-4 proposals before first win - this is normal learning curve

Phase 4: Post-Award Excellence (Months 6-12)

Deliver exceptional performance

- Why first contract performance is critical: CPARS (Contractor Performance Assessment Reporting System) rating affects next 10-20 proposals for 3 years - Performance goals: On-time start, zero security incidents, excellent customer service, responsive communication - Supervision: Visit facility weekly for first 90 days, then biweekly, address issues same-day - Communication: Weekly check-ins with COR, monthly performance reports, proactive problem-solving

Document performance for future proposals

- Save monthly performance reports, commendation letters, CPARS ratings - Request testimonial from COR at 6-month mark - Photograph facility, guards in uniform (with permission) for capability statement - This becomes past performance for next proposal

Pursue second contract

- Timeline: Start pursuing second contract at Month 6-9 of first contract - Sizing: $150K-$500K (larger than first, leveraging past performance) - Certifications: If you applied for 8(a), SDVOSB, WOSB in Phase 1, you may now be certified - Leverage: Use first government contract as past performance (even if ongoing)

Success Metrics and Timeline Expectations

| Milestone | Target Timeline | Success Indicator |
|-----------|----------------|------------------|
| SAM.gov registration complete | Week 2 | Active registration, NAICS codes correct |
| Capability statement created | Week 4 | Professional one-pager, 3-5 past performance projects |
| First proposal submitted | Month 4-5 | Compliant, competitive pricing, strong technical |
| First contract awarded | Month 6-12 | $50K-$150K contract, matches capabilities |
| First contract performance | Months 6-18 | Excellent CPARS rating, zero major incidents |
| Second contract awarded | Month 12-18 | Larger contract leveraging first past performance |

Realistic Expectations

• Proposals before first win: Expect to submit 3-7 proposals before winning first contract
• Win rate: 15-25% for first 5 proposals (learning curve), 30-40% after 10+ proposals
• Year 1 revenue: $100K-$400K from government contracts (one contract)
• Year 2 revenue: $400K-$1.5M from government contracts (2-4 contracts)
• Year 3 revenue: $1M-$5M from government contracts (5-10 contracts)

Government security contracting is marathon, not sprint. Contractors who persist through first 3-5 proposals and deliver excellence on first contract build sustainable government revenue over 3-5 years.

Learning from others' mistakes is faster and less expensive than making them yourself. Here are the most common errors new government security contractors make, why they fail, and how to avoid them.

1. Bidding Armed Contracts Without Proper Licenses and Insurance

Mistake: Security contractor sees high-paying armed guard contract and bids despite not having firearms licenses or appropriate insurance.

Why it fails: Armed security requires:

• State firearms licenses for company and individual guards (training, background checks, qualification)


• Higher insurance limits ($2M-$5M general liability vs $1M-$2M unarmed)


• Annual firearms qualification (range time, ammunition costs)


• Significantly higher liability exposure (shooting incidents, use of force)

If you win armed contract without these, you cannot perform. If you try to get them after winning, timeline is 60-180 days and you may miss contract start date (government terminates contract for default).

Solution: Only bid armed contracts if you already hold all required firearms licenses and insurance. If you want to pursue armed contracts, obtain licenses and insurance first (3-6 months process), then bid. Do not bid and hope you can get licenses later.

2. Underestimating Service Contract Act Wage Requirements

Mistake: Bidding federal security contract using commercial wage rates ($15-$18/hour) without checking wage determinations.

Why it fails: Most federal service contracts over $2,500 fall under Service Contract Act (SCA), which requires prevailing wages. SCA wages for security guards are often 30-100% higher than state minimum wage.

Example: Washington DC security guard SCA wage (2026):

• Commercial rate you normally pay: $17/hour


• SCA prevailing wage: $22.50/hour


• SCA fringe benefits: $5.80/hour (health insurance, vacation, holidays)


• Total SCA cost: $28.30/hour


• Your bid shortage: $11.30/hour × 2,080 hours = $23,504 annual loss

If you bid $17/hour and win, you are legally required to pay $28.30/hour. You will lose money on every hour worked.

Solution:

• Check if solicitation references "Service Contract Act" or "wage determination"


• Look up wage determination number on sam.gov or dol.gov/whd


• Calculate labor costs using SCA wages, not your commercial rates


• Build SCA wages into pricing or you will lose money

3. Ignoring Background Check and Clearance Timelines

Mistake: Winning contract with 30-day start date, then discovering FBI background checks take 60-90 days and guards cannot work until cleared.

Why it fails: Government contracts, especially DoD and secure facilities, require background checks before guards can start:

• FBI fingerprint checks: 30-60 days


• National Agency Checks (NAC): 60-90 days


• SECRET clearances: 6-12 months


• TOP SECRET clearances: 12-24 months

If contract starts before guards are cleared, you are in default (cannot perform). Government can terminate contract and pursue damages.

Solution:

• Read solicitation for background check and clearance requirements


• Ask during pre-proposal conference: "What is typical timeline for background checks?"


• If timeline is tight, ask for incumbent guard list (sometimes you can hire incumbent guards already cleared)


• Build clearance timeline into transition plan: "We will submit background checks within 5 days of award to meet 90-day start date"


• Have backup guards in case primary candidates fail background checks

4. Bidding Multi-Facility Contracts Without Logistics Capacity

Mistake: Small security company bids $2M multi-facility contract covering 15 buildings across 3 states because revenue looks attractive.

Why it fails: Multi-facility contracts require:

• Supervisors in each location (cannot supervise remotely)


• Backup guards for each facility (when guards call out sick)


• Vehicles for supervisory visits (if facilities are geographically dispersed)


• Complex scheduling and payroll (different shifts, locations, wage rates)


• Performance tracking across multiple sites

If you cannot recruit, train, supervise, and retain 30-50 guards across multiple states, you will fail performance standards and receive poor CPARS rating.

Solution: For first government contract, target single-facility contracts within 50 miles of your office. This minimizes logistics, allows hands-on supervision, and reduces risk. After successful performance on 2-3 single-facility contracts, pursue multi-facility opportunities.

5. Underbidding to Win, Then Delivering Poor Performance

Mistake: Cutting pricing by 20-30% below costs to win first contract, planning to "make it up" or "prove yourself."

Why it fails: Government contracts are firm-fixed-price. If you bid $100K and your costs are $120K, you lose $20K. You cannot:

• Renegotiate pricing mid-contract


• Bill for "extras" like commercial contracts


• Reduce service quality to cut costs (results in poor CPARS rating)

Consequences:

• Financial loss (operating at negative margin)


• Poor service quality (cannot afford adequate supervision, training, equipment)


• Poor CPARS rating (affects next 10-20 proposals)


• Damaged reputation (agencies share information about poor performers)

Solution: Price to win competitively but maintain 10-15% profit margin. If your cost estimate is $120K, bid $132K-$138K (10-15% profit). If you need to cut 20-30% to be competitive, you either:

• Miscalculated costs (review your estimate)


• Are bidding contract you cannot perform competitively (pursue different opportunities)


• Are competing against incumbents with economies of scale (target smaller contracts)

Never bid below cost. If you cannot win profitably, do not bid.

6. Ignoring Insurance Requirements Until After Award

Mistake: Winning contract, then discovering required insurance limits are $5M general liability (you have $1M) and premium is $30K (you budgeted $8K).

Why it fails: Government contracts specify insurance requirements in solicitation. You must provide proof of insurance before contract start. If you cannot obtain required insurance:

• Government terminates contract (you lose)


• You pay higher premiums than budgeted (eliminates profit margin)


• Some insurers will not write high-limit policies for new government contractors (no coverage available)

Solution:

• Read insurance requirements in solicitation (usually Section H or special provisions)


• Contact your insurance agent 2-4 weeks before bidding: "I am bidding a government security contract requiring $5M general liability and $5M auto liability. What is premium?"


• Get written quote, build actual cost into pricing


• If insurance is not available or too expensive, do not bid that contract

7. Poor Quality Proposals (Non-Responsive or Non-Compliant)

Mistake: Submitting proposal that does not address all requirements, missing required documents, or violates page limits.

Why it fails: Government evaluates proposals for compliance first, merit second. Non-compliant proposals are rejected without reading technical content.

Common compliance failures:

• Missing required certifications (SF-330, representations and certifications)


• Exceeding page limits (15-page limit, you submitted 22 pages = rejected)


• Not addressing all evaluation factors (solicitation has 4 factors, you addressed 3)


• Unsigned documents (some forms require signature)

Solution:

• Create compliance matrix: list every solicitation requirement, confirm you addressed it, note page number


• Follow formatting requirements exactly (font size, margins, page limits)


• Include all required forms and certifications


• Have someone outside your company review proposal before submission (APEX Accelerators offer free reviews)


• Submit 2-3 days early (not last minute when you cannot fix errors)

8. Neglecting Past Performance Documentation

Mistake: Delivering excellent security services but not documenting performance or requesting references/testimonials.

Why it fails: Past performance is worth 30-50% of proposal evaluation score. If you cannot prove you performed well, evaluators assume you did not. Without documentation:

• No CPARS ratings to reference


• No customer testimonials to include


• No performance metrics to demonstrate excellence


• Weak past performance score on next proposal

Solution:

• Request CPARS rating at contract end (if federal contract over $150K)


• Request testimonial letter from facility manager at 6-month mark and contract end


• Document performance metrics: "Zero security incidents over 12-month contract, 98.5% post coverage, exceeded customer expectations"


• Save commendation emails, performance reports, incident logs (redacted as needed)


• Use this documentation in every future proposal

Think of current contract performance as marketing investment for next $500K in contracts.

9. Ignoring Relationship Building

Mistake: Bidding on contracts without ever meeting agency personnel, attending industry days, or building relationships.

Why it fails: Government contracting is relationship business. Agencies prefer contractors they know and trust. When two proposals are technically equal, agency chooses contractor they have met and feel confident in.

Without relationships:

• Miss early intelligence about upcoming contracts


• Cannot ask clarifying questions before solicitation release


• No agency advocate when your proposal is evaluated

Solution:

• Contact Small Business Specialists at target agencies (introduce capabilities, request forecasts)


• Attend industry days and matchmaking events (bring capability statements, ask questions)


• Visit APEX Accelerators (free counseling, agency introductions)


• Join industry associations (ASIS International, state security associations)


• Maintain regular contact (quarterly check-ins, share capability updates)

Relationship building is 6-12 month investment that pays off with contract awards and insider intelligence.

10. Giving Up After First Loss

Mistake: Submitting one proposal, losing, concluding government contracting does not work for security companies.

Why it fails: Government contracting has learning curve. Win rates:

• First 3 proposals: 10-20% (learning compliance, evaluation criteria, pricing)


• Proposals 4-10: 25-35% (improving based on debriefings)


• After 10+ proposals: 35-45% (experienced, strong past performance)

Solution: Expect to lose first 2-4 proposals. This is normal. Request debriefing after every loss:

• What was winning score vs your score?


• Were there technical deficiencies?


• Was pricing competitive?


• Was past performance weak?

Use feedback to improve next proposal. Most successful government security contractors did not win their first bid - they won their third or fifth bid after learning from losses.

Persistence separates contractors who build $5M government portfolios from those who give up after one loss.