As all regular readers of our posts would know, shelf companies have many inherent advantages that make them attractive for entrepreneurs and veterans in their businesses. In this post, we will discover why aged corporations are so much in demand, especially in the government sector. Many vendors provide shelf corporations for sale, and the reason for this is not hard to find. Such companies have a valuable vintage of several years and are offered at a premium to buyers. The reason for the high price will be revealed in the following paragraph.
Requirements of a government contract
It is hard for businesses to land a government contract. For a new business owner who is just starting out, this quest can prove to be impossible. The reasons for this are many. The competition in this sphere is intense, as the government is considered to be the best customer. In such a contract, there is very little to no chance of default, and if you are awarded a contract, you are bound to be paid. The bureaucratic processes of the state might take a bit of time, but the payment is guaranteed.
Now, let us come to the conditions that the government imposes before it awards a firm a contract. The first condition is the ability or the required qualification to execute the works that have been mentioned in the tender document. If you are specialized in that sector, your firm will have that ability, and might even be able to do it better than the others in the fray.
However, it is the other condition that becomes a stumbling block for entrepreneurs. Most contracts stipulate that a firm must exist for a pre-defined number of years before becoming eligible to qualify. The question for a new business is how does it show such vintage. For some firms, such contracts can mean the difference between failure and success. The only solution is to buy a shelf company in the state where the contract is being awarded. Before purchasing, you must do your due diligence and check the records of the target company. The age of the firm must be higher than that specified in the bidding documents. If you fail to do a thorough check, then you cannot blame anyone else! After all, when you invest your hard-earned money in a financial asset, it is your responsibility to look before you leap!
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