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What are the three biggest challenges suppliers face in their efforts to win government business?

Guest post by: Jon Hansen

Article Overview: Being well into the 7-Part "Seven Steps to Success: Jump Start Government Contracts Series," with expert author Judy Bradt on the PI Window on Business Show on Blog Talk Radio, the launch of the Public Sector Suppliers Forum on LinkedIn and of course the Essential Connections Blog, we seem to have touched on a hot topic that has been simmering for some time. Specifically, the disconnect between the tremendous opportunities afforded companies through government contracting, and the practical realization of said opportunities for the majority of suppliers.

What are the three biggest challenges suppliers face in their efforts to win government business?

Being well into the 7-Part "Seven Steps to Success: Jump Start Government Contracts Series," with expert author Judy Bradt on the PI Window on Business Show on Blog Talk Radio, the launch of the Public Sector Suppliers Forum on LinkedIn and of course the Essential Connections Blog, we seem to have touched on a hot topic that has been simmering for some time. Specifically, the disconnect between the tremendous opportunities afforded companies through government contracting, and the practical realization of said opportunities for the majority of suppliers.

Last week we hit the virtual streets of the social media world to connect with the LinkedIn community in an effort to get their input on the three biggest challenges suppliers face in their efforts to do business with the government.

The following presents both the question that was posed, as well as a few of the answers we received. Given the high and continuing frequency of responses, over the next few weeks we will be posting 2 to 3 responses from the community, and would of course invite your feedback through the Essential Connections Blog.

(Note: the demographics for LinkedIn indicates that the majority of the network’s membership are business professionals in their 30s.)

Question: What are the three biggest challenges suppliers face in their efforts to win government business?

Response 1:

1) Understanding the government market and the differences between B2B/B2C and B2G. Most companies that fail at B2G do so because of poor market entry: lack of knowledge, advice from the wrong sources, unrealistic expectations, inability to focus your strength on the needs of a specific agency, etc. Proper planning and good research is the key to successful market entry.

2) Understanding how the government agency you are targeting buys your product or service. This varies on the federal level from agency to agency, some preferring agency-specific contracts, some like GSA Schedules, etc. When you expand to state and local, the contract options grow exponentially. You have to know how they prefer to buy.

3) Once you understand how they prefer to buy, learning the best ways to deliver your message to the buying infleuncers is next. This is different for products and services. Low-end products will have a different set of tools than high-end products, as do low-end and high-end services. For higher-end products and services, white papers (traditional and audio) still work, as do webinars, PR, sales calls, networking and more. For low-end products and services, a really robust web site is the starting place.

Hope this helps.

Mark Amtower, Foremost B2G Marketing Consultant and Social Media Strategist

Response 2:

Here in the US, at least, delaing with the government is indeed a challenge….I suspect the same is true in Canada.

1) (summing Mark’s comments) — Understanding the rules of the game. There are plenty of rules and exceptions to those rules. The challenge is knowing them well enough to use them to your advantage over competitors and with what will seem like an adversarial agency.

2) Contracting requirements and managing flow-down clauses. If you do not understand the contract and how the government manages those contracts you may very well miss important requirements that must be flowed-down to your own contractors/suppliers. Missing one of these key items can spell disaster!

3) Military requirements – If doing business with the military, do you fully understand the DFAR, its relation to FAR, and ITAR requirements? Doing military business introduces additional twists to government business. Again a failure to understand those special requirements can quickly result in very unpleasent experiences.

The key to success with government contracts is knowing the rules to the game and which variation on that theme you are playing.

Bijorn Nilsen, Materials Manager at Global Ground SUpport

Response 3:

That’s a good question and a tough one — there are lots of challenges. Here are what I see as the three biggest:

(1) Understanding the price it takes to win. Regardless of what a solicitation says about “best value” or trade-offs that allow the Government to award to other than the lowest bidder, price is generally the number one concern. Even if you offer a better technical solution than your competitors, the customer will often settle for technically acceptable solution (rather than your better one), to obtain a lower price.

(2) Selecting teammates. These days, it is next to impossible to win federal contracts on your own. You need to find subcontractors to complement your technical capabilities. It’s not as easy as picking well-qualified firms – for large businesses, you have to worry about meeting socio-economic goals — meaning, awarding a percentage of your subcontracted dollars to small and small disadvantaged firms. It’s often difficult to strike this balance. For small firms, you often have to take on the role of a subcontractor and find a prime that will commit to giving you meaningful work.

(3) Identifying contracts which you’re currently peforming, or have previously performed, as past performance references. While you may have contracts under which your performance has been exemplary, solicitations often include specific criteria regarding which contracts you can cite for past performance purposes. For example, you may not be able to include contracts more than three years old — or the customer may only want contracts under which you’ve performed very specific types of work that they’ve identified.

Andy Reidenbaugh, Deputy Director of Contracts and Procurement at Alion Science and Technology

Once again, we both encourage and welcome your feedback to the question “What are the three biggest challenges suppliers face in their efforts to win government business?” as well as the responses.

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Article Tags: government purchasing, public sector procurement, suppliers



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