Preparing your business for the federal year-end buying season (with related video)
During the fourth quarter of the federal fiscal year, which ends on Sept. 30, government agencies are finalizing their acquisitions for the year. Agencies are assessing and calculating their remaining dollars to potentially check off a few items not purchased on this year's wish list.
Many small business contractors find that they can pick up a few hundred thousand dollars or even a few million dollars in revenues from various government customers during this period. This is especially true for small businesses with special certifications. This is especially true for small businesses with special certifications that have taken the time to prepare for the federal year-end buying season.
This year holds a few extra challenges that we have not had to consider in the past—sequestration and differing evaluation factors. This year, the pressure to complete acquisitions and spend budgets has put extra pressure on contractors as well as procurement officials, since staffing hours are cut up to 20 percent where furloughs have been implemented. Being able to anticipate and identify opportunities, being ready to respond and capture quickly and have your pricing competitive, has never been more important.
You may have won a contract with a customer who loves you and was willing to pay a bit more since they considered you the “best value,” but beware that the evaluation factor is quickly changing in importance and in reality. The term LPTA or “lowest price technically acceptable” is quickly becoming the leading factor in choosing winners.
So how can small businesses land more dollars in this fourth quarter of FY2013?
TIPS TO GET STARTED
The following are tips to get you started and on your way to getting your share of remaining procurement dollars before the end of federal FY 2013.
* Move quickly to identify and respond to opportunities. That means checking for new solicitations, reviewing agency budgets to determine what work is unfinished and asking agency officials about upcoming projects that are likely to weather budget cuts.
* Make sure the necessary back-end stuff is completed in advance to capture fast-breaking opportunities. In addition to having your past performance documents updated to include contracts in progress, also make sure you and your teaming partners are ready to sharpen your pencils and provide the lowest possible price to hold your position—especially with those customers that you have worked so hard to cultivate.
* Search on FBO.gov for “sources sought” notices, which are synopses posted by agencies that state they are seeking possible sources for a project. Although they are not solicitations for work or even requests for proposal, sources sought notices present a great opportunity for you to call attention to your firm’s capabilities. They are part of a federal agency’s market research, and responses are often used to justify set-aside requirements. Keep in mind that this year, lowest cost still rules over certification in many cases.
* Tap existing government customers and remind them that your company is available. In business, it takes five times more in cost to create a new customer than to expand with an existing customer—the same holds true in the federal marketplace.
MORE TIPS TO GET STARTED
* Maintain regular communication with the Office of Small and Disadvantaged Business Utilization (OSDBU) staff at various agencies and remind them that you have a strong interest as well as the performance capacity to be able to quickly respond to any of their customers during the fourth quarter.
* Team, team and team. Teaming with other business owners to jointly bid on federal contracts can help increase chances of landing larger contracts. According to American Express OPEN’s government contracting survey, businesses that are involved in teaming have won 54 percent more prime contracts than the national average.
* If you’re on a GSA Schedule, aggressively market this contracting vehicle to agencies. The end of the federal fiscal year is all about quick capture, so the use of GSA Schedules for acquisitions becomes especially attractive to agencies. GSA Schedules offer agencies the presumption of competition, the thoroughness of vendor vetting, ease of use and expedited processes. In keeping with this year’s competition theme, be prepared to discount your GSA Schedule contract price to win work!
The key to success in the fourth quarter is creating your own luck and being prepared to respond quickly. But even though time is scarce, do your homework before any communications or solicitations go out, as there is no excuse for not knowing your customer's mission and objectives. An educated contractor is, indeed, a successful contractor.
Dona Storey is the American Express OPEN Advisor on Procurement and a woman-owned small business contractor herself. She helps other small firms navigate the procurement process. For more information, please visit this site.
Julie McNeil discusses best practices in doing business with the government at an American Express Open Forum in this video.