“Regardless of what the economy is doing, that business is always out there,” says Patrick Malyszek, president of the M3 Federal Contract Practice Group, a New York consulting firm that works with government contractors. “It’s a considerable resource provided that you approach it right and are doing everything appropriately.”

And thanks to the “Prompt Payment” rule, the federal government can’t drag its heels when it comes time to pay the bills, like some commercial customers might. The rule states that the government must pay its vendors in a timely manner or else suffer interest penalties. “The federal government is a great customer,” says Pamela J. Mazza, managing partner with Washington, D.C. law firm PilieroMazza and an expert on government contracting. “If you are able to make sure that you’re submitting valid invoices and have the backup you need, you will get paid as long as you’ve performed. I think that’s a big plus.”

Getting into government contracting isn’t easy. Businesses must follow strict bidding policies and procedures, and it’s sometimes hard for a first-timer to win a contract. And once it does, the business has to live up to its end of the bargain or pay the price, which could be termination of the contract or a ban from any further participation in the federal contracting program. “Understanding the entire system is critical for any new contractor to actually succeed,” says Malyszek.

Businesses also need to make sure the price they’ve set for their goods or services is one with which they can actually work. “Margins on government contracts aren’t what they are in the private sector,” says Mazza. “So you do need to know what you’re doing when you put your proposal together, because [if not] you can lose money.”

Among the various federal government agencies, the Defense Department is a big spender. In FY2007, it issued more than three million contracts worth some $316 billion, about 70 percent of total contract dollars awarded that year. So it’s no surprise that many companies want to tap into this market.

Sarasota and Manatee had 159 companies in 2006 that won contracts worth a total of $58 million from the Defense Department. We spoke with four of these companies to find out how they got their foot in the door at the Pentagon, what they’re supplying to the U.S. military, and how these types of contracts can impact their bottom line.

Gyrocam Systems

Ken Sanborn used a beat-up white Suburban to convince the military to buy his cameras to combat roadside bombs.

Since then, Department of Defense contracts have skyrocketed Sarasota-based Gyrocam Systems’ revenue from $5 million in 2006 to more than $500 million this year. Boosting that figure: a $302 million contract the company won in May to supply the U.S. Army 500 with more camera systems for use in Iraq and Afghanistan.

“It’s a wonderful way for us to grow our business and to do something that really makes a difference and helps not only save soldiers, but helps future Iraqi citizens,” Sanborn says.

More than 90 percent of Gyrocam’s revenue comes from Department of Defense contracts. The company, which has 114 employees, wasn’t even concentrating on the military until the start of the Iraq War.

After Sanborn heard reports about deadly explosions, he thought his camera—previously used for aerial photography for commercial clients—could be used to detect roadside bombs. He learned from a Gyrocam consultant that the military was interested in his airborne system. But he was determined to show them something different—a camera attached to a vehicle. He had been tinkering around with mounting the camera on the 1997 Suburban he used for running errands.

Sanborn thinks his staff probably thought, “Oh man, Sanborn’s lost his mind,” he says. “Nobody is going to buy a camera that costs $300,000 and is mounted on a truck.”

Sanborn “cobbled up” a mast mount to attach the camera to a trailer hitch. The gyroscope helps the camera show a clear picture, even as a vehicle moves, allowing soldiers to see potential danger over bridges, buildings and sand dunes from their heavily armored vehicles. “It’s like having a bionic eye,” he says.