Commentary
Vendors pushing at last minute to land federal contracts before Sept. 30 (with related video)
Here is another report in GPN’s series on strategies for businesses that wish to sell more goods and services to federal agencies. As the end of the 2013 federal fiscal year approaches on Sept. 30, government market observers such as Lisa Firestone say that federal agencies are entering the busy federal buying season. GPN caught up with government marketing expert Jennifer Schaus to find out about end of federal fiscal year strategies.
Government Product News: How do you see the end of FY 2013 shaping up? Are your clients seeing increased federal activity?
Jennifer Schaus: Our customers are busier than ever now, mostly in proposal-writing mode, responding to GSA E-Buy notifications or we are making modifications to their GSA Schedule to add products/services for quick year-end purchases.
They are also seeking partners that have the Service-Disabled Veteran-Owned Small Business (SDVO) designation, or that are taking part in the Small Business Administration’s (SBA) 8(a) program. Our clients are also searching for partners who have HUBzone certification. It is all about relationships not only with your customers (the government) but also with you competition.
The SBA’s 8(a) business development program is a business assistance initiative for small disadvantaged businesses. The 8(a) program offers a range of assistance to firms that are owned and controlled at least 51 percent by socially and economically disadvantaged individuals.
The Historically Underutilized Business Zones (HUBZone) program helps small businesses in urban and rural communities gain preferential access to federal procurement opportunities. To qualify for the program, your business must be located in an area designated as a HUBZone.
GPN: What strategies should companies employ now?
JS: Companies need to know what their value is in solving the customer problem — plus obtaining additional points for checking the box or boxes helping the agency meet their set-aside goals. If you can achieve those pieces of the puzzle, you may have a bit more freedom when it comes to price.
GPN: We hear that the end of the federal fiscal year is an important time for vendors who want to sell to federal agencies. Is that true?
JS: The Federal Q4 game is like the purchase made in the airport before the discerning frequent travelers’ flight. It’s very time-sensitive. What is easy to buy? Which vendors are reputable, easy to find, easy to buy from — and make you look good? You’ve got money in your hand and you need to use it, otherwise it’s gone.
At federal agencies during the fourth quarter, the buyer will choose the firms that they know and trust. This is not the time to implement a pilot program.
GPN: Will sequestration have an impact on end of federal fiscal year 2013 purchases?
JS: The sequester is necessary, but it is driving competition up and prices down — thus causing LPTA procurements. LPTA means Lowest Price Technically Acceptable. Companies are almost buying contracts — not making any money — in the hopes of staying alive and getting “in” to build on the existing business (in future years).
They will cross their fingers in the hopes of increasing prices with a contract renewal the following year. This has become survival of the fittest and jumping through the hoops for the buyers (i.e., obtaining the 8(a) certification, the SDVO verification, getting on the GSA Schedule). For vendors, the goal is to make it easier for the buyer to find you, procure from you and check some boxes so they, the buyers, shine, too. There’s just a lot more companies on the playing field with which to contend — or partner with.
GPN: Thank you, Jennifer Schaus.
Jennifer Schaus leads her boutique consulting firm that specializes in the U.S. government sector. Her firm’s offices are located in Washington, D.C., and in Rome, Italy. The firm helps companies analyze, assess and capitalize on business opportunities in the U.S. government sectors (includes federal, state and local and quasi-government organizations — NGOs, etc.). Schaus’ clients include both product and service companies from all industries.
In the video, Jennifer Schaus hosts a discussion of the SBA 8(a) certification process for small and disadvantaged businesses. The video is part of a series of government contracting webinars.
