Posts

Is Running a VAR Keeping You Up at Night?

Two parts of running a successful business in GovCon are knowledge and compliance. You need to know your requirements and how to follow those directives. Add to that the complexities of running a VAR/reseller and we’d bet that there are several things keeping you up at night – in addition to booking sales that is.

Below are some important compliance items that you should keep in mind.  Maybe they will even help you sleep better at night (probably not, but we’re trying!).

  1. Service Contract Act complianceThis is especially important for those offering ancillary services in support of the products (think maintenance, warranty or help desk). Many of the VAR/reseller-type services are potentially covered by a Wage Determination.  Most VARs do not provide the services themselves, but rather, the OEM.  Add this to the fact that most services are buried in the product line item, it can be challenging to determine whether or not the SCA even applies to your PO. As such, a certain level of “due diligence” needs to be conducted to ensure compliance. The last thing anyone wants is the DOL knocking on your door with an audit request.
  2. NMRThe infamous Non-Manufacturer Rule (NMR) is a thorn in any VAR’s side when it comes to GovCon and IT. The NMR is an exception to the SBA performance requirements and limitations on subcontracting (LOS), which provide that on a supply contract, a firm must perform at least 50% of the cost of manufacturing the supplies. FAR 52.219-14.  There are some large vehicles, such as the NASA SEWP, that contain the LOS. Practice tip – if you are selling big IT equipment, ask your CO to remove the clause from the solicitation.
  3. Efficient “vendor” managementAlongside the heavy traffic of deals streaming in and out of a VAR, it’s hard to imagine tracking, managing, inspecting, and reporting all of your vendors. Compliance requirements for counterfeit parts, data breach safeguarding, and flow downs seem like an impossible mountain to summit. Let us shine a light in the darkness here for you: BOOST can provide a framework and strategy to best manage these pieces while saving you sanity and time.

Even if you’re sleeping at night like a bear in winter, these can still cause quite the headache.  Our mission at BOOST is to alleviate your headaches by helping you with the stuff you don’t have the time, the interest, or the man-or-woman-power to handle.  Focusing only on GovCon, allows BOOST to make your life easier and more efficient.  Let us help you cross another task off your list, email [email protected] and let’s discuss the possibilities.

Corporate Housekeeping

As we turn our attention to back to school sales, last summer vacays, finishing up our trashy beach novels and start shifting towards the fall, it’s a good time to take a minute and do some general housekeeping. Face it – it will be the holidays before you know it!

GovCons, you are in the lull between the storm – proposals are submitted, awards are forthcoming but not here yet. Tt’s a great time to catch up on some of the mundane, but necessary parts of doing business.  It’s boring, and always gets pushed to the back burner as more revenue-generating opportunities come in.  But ignore these at your peril – they always come back to haunt you at tax time, during a transaction or with any litigation.

We’re kind of like sour patch kids, here at BOOST. Now that we’ve given you a bit of a gut punch, here’s a quick checklist to keep you sane:

1. Org Chart
When was the last time you actually updated it?  Do it now before you onboard all the new contract wins.  This way it’s readily available.  Now might also be time to consider if folks are really in the right positions/titles.

2. Articles of Incorporation
Time to dust it off and make sure it’s still legit and up to date

3. Board meeting minutes
For privately held companies, this can feel like an administrative task you don’t want to do.  Remember that these board meeting minutes come in handy when you are looking toward a sale, are in litigation/disputes and are just plain good practice.

4. Tax Filings
Given all the changes, are you structured the way you should be?  If your uncle is still providing all of your advice, it might be time to get a second opinion.  Are you maximizing your tax status for your long-term strategy?

5. State filings
We always forget that when we add new employees in new states, we suddenly must start filing taxes.  Be proactive about registering and don’t let it be a nasty surprise year in arrears.

6. Insurance
When was the last time you sat down and went through what you are covered for and where you might have gaps?  I absolutely HATE this practice but make myself (and another person to get a different perspective) sit in the excruciating meeting and review everything.  Line by freaking line.  It’s horrible, my broker hates us, but we’ve discovered multiple things that weren’t covered or that we didn’t need to pay for.  It’s worth the investment of time (and sanity) once a year to know your risks.

 

If you need help with anything, we’re happy to give you our advice or introduce you to others that have that specialty.  Don’t slack off as we head towards the fall.  It will only come back to haunt you when you least expect it (or have time to deal with it!).