What Happens After You Win a Government Contract

Winning the bid isn't the finish line. Between the award notice and your first payment sits a chain of paperwork: contract signing, bonds, insurance certificates, a purchase order, a notice to proceed, and then invoicing on the government's timeline, not yours. None of it is hard, but the sequence matters, and new vendors get hurt by doing things out of order. The most expensive mistake is simple: starting work before you're legally allowed to. Here's the whole path, in order.

Award notice vs. signed contract (don't start work yet)

First you'll get some form of award notice. Maybe a phone call, maybe an email, maybe you watch the council vote at a public meeting. Feels great. Legally, it usually means very little.

An award notice, or a "notice of intent to award," says the agency plans to contract with you. It is not a contract. There's often a protest window after the notice where a losing bidder can challenge the award, and the agency can generally still cancel the whole solicitation before signing. You have a contract when both sides have signed one, and not before.

So don't order materials, don't turn down other work, and absolutely don't start performing based on a congratulations email. If you work before the contract is executed and a notice to proceed is issued, most agencies can't legally pay you for it, even if they want to. Government staff can't approve payment for work that happened outside a contract. Vendors have eaten real money learning this.

What paperwork comes due at signing?

Once the award is final, the agency sends the contract, and it usually comes with a deadline, often 10 to 15 days, to return it with your attachments. Typically that means some or all of the following.

Performance and payment bonds. On construction and many service contracts, the bid bond you submitted with your bid now gets replaced by performance and payment bonds, usually for 100 percent of the contract value. Your surety handles this, but it takes days, not hours, so call your bond agent the day you get the award notice. If you can't deliver the bonds on time, the agency can pull the award and go to the next bidder, and they may keep your bid security.

Insurance certificates. The contract will specify coverage types and limits, and almost always requires the agency named as additional insured on your liability policy. Your insurance agent produces a certificate of insurance (a COI) showing exactly what the contract demands. Read the requirements yourself before forwarding them, because "additional insured" endorsements and specific limit language trip up agents who don't do government work often. A COI that doesn't match the contract language gets kicked back, and the clock keeps running.

Whatever else the contract lists. W-9, vendor registration in their payment system, business license copies, maybe a signed acknowledgment of prevailing wage requirements. Do it all at once. Every incomplete item delays your start date, and your start date delays your first invoice.

Purchase orders and the notice to proceed

Even with a signed contract, most agencies don't consider you cleared to work until two more pieces of paper exist.

The purchase order (PO) is the finance department's side of the deal. It encumbers the money, meaning the funds are formally set aside for your contract, and it gives you the number you'll reference on every invoice. No PO usually means the payment system literally has nowhere to put your invoice. If you haven't received one by the time you're ready to start, ask.

The notice to proceed (NTP) is the official green light, common on construction and project work. It states the date your performance period begins, which is also the date your deadline clock starts. On simpler service and supply contracts there may be no formal NTP, and the PO itself serves as your authorization. When in doubt, ask your contract contact one plain question: "Am I authorized to begin work, and what document says so?" Get the answer in writing.

How do you invoice, and when do you get paid?

Invoicing government is its own small skill. The contract or PO spells out what an invoice must include, and it's usually more than your commercial customers want: the PO number, the contract number, line items matching the contract pricing exactly, the service period, sometimes certified payroll on prevailing wage jobs, sometimes signed delivery tickets or a progress report. An invoice that doesn't match the PO gets rejected and returned, and your payment clock restarts from your corrected submission. Get the first invoice perfect and copy it forever.

Payment terms are typically net 30 or net 45 from receipt of a correct invoice, and many states have prompt payment laws that require agencies to pay within a set window or owe interest. In practice, expect your first payment to take longer than the stated terms while you get set up in their vendor system. Construction contracts also commonly hold retainage, often 5 to 10 percent withheld from each progress payment until the job is accepted.

Here's the honest summary contractors trade with each other: government pays slow, but government pays. Agencies don't go bankrupt on you, they don't dodge your calls for 90 days and then vanish, and the money is appropriated before the PO exists. Plan your cash flow for slow, reliable money. Don't take a government job so big that waiting 45 to 60 days for the first check would sink you.

Keep the relationship warm

Once you're performing, remember that the person managing your contract talks to purchasing. Hit your dates, document everything, flag problems early instead of hiding them, and respond to emails fast. Renewals, option years, and the next bid all get easier when you're the vendor who was easy to work with. Plenty of small vendors build a steady business on a handful of agencies that trust them, and that trust starts during the first contract, not the tenth.

If this is your first award, or you're still chasing it, the full path from nowhere to first win is laid out in /guides/how-to-win-your-first-government-contract. And it's worth skimming /guides/what-is-a-bid-bond before your next bid, since bonding capacity is what limits how much government work you can hold at once.

One win shouldn't be the whole plan. The vendors who do well here keep a pipeline running so the next bid is always in progress while the current job pays out. See what's open in your state today at /states/fl or your own state's page, and set up a free GovBids Pro alert so the next opportunity shows up on its own.