Selling to State and Local Government: Understanding the Government Buyer by Charles A. HarrisAccording to the U.S. Census Bureau, in 1996 the total direct expenditure for state and local governments in the United States was $1,247,435,978,000 (over $1.2 Trillion) How much of that did your company receive? Written from the viewpoint of someone who has spent many years on the other side of the table, Charlie takes you inside the government purchasing process. But more importantly, he takes you inside the minds of the government buyers. His insights into the motivation and perspective of the government officials you will deal with in a public sector sale are invaluable. Selling to State and Local Government is must read for sales professionals interested in entering the rewarding world of selling to state and local government.
Episode 5: Marketing Best Practices for State and Local Government
Here's how a tiny company started closing huge deals with federal government agencies—and how you too can get started in B2G business-to-government sales. B2G stands to business-to-government. It simply means that a business is selling its products or services to the government. It's also sometimes referred to as B2A, which stands for business-to-administration. Anytime a business sells a service or product to a government agency, that's B2G—whether it's a multi-billion dollar defense contractor like Lockheed Martin selling missiles, Insight Enterprises selling IT solutions to administrations, or a tiny company you've never heard of selling office supplies to federal agencies. If you're curious, you can visit USAspending.
Do your research. Determine to which agency or agencies you want to sell, visit their website and find out how they do their purchasing. Do they have a purchasing department, or can each department do its own purchasing? Are there certifications or preference designations you should pursue ie: in-state, small, small disadvantaged, woman-owned, veteran-owned, etc. There is a huge variance in purchasing practices among states, and even among counties or cities within the same state. Learn how your target market operates. Create a one page Capability Statement which lists your capabilities, tailored to match the mission of the agency you are targeting.
The U. If you would like to establish your company in this market, then our goal is to assist you in doing business with state and local government procurement agencies. We will also address some of the business identification numbers that may be required by the state vendor registration forms. We will help you find the QPL or Standards for your state. All of the State Purchasing Agencies use an online system that simplifies the bidding process. Some states maintain their own online procurement systems, however, many states contract with Procurement or eProcurement companies. These online systems organize the entire bid process for both the purchasing and vendor side of the relationship.
Understand what’s top of mind for your prospect
There are over local Procurement Technical Assistance offices in the U. Here is a brief list of those tips. Determine to which agency or agencies you want to sell, visit their website and find out how they do their purchasing.
A company looking to do business with the government has to be aware that there are some considerable differences between government purchasing practices and the purchasing practices of commercial businesses. The government has a certain authority and rights that commercial enterprises do not have. Commercial purchasing is governed by the Uniform Commercial Code UCC , whereas federal government purchasing is governed by the Federal Acquisition Regulation FAR and pertinent agency supplements, which seek to make procurement decisions fair, transparent, and a good value for taxpayers. In doing business with a commercial entity, the terms of the contract are determined by mutual agreement between the parties. If a contractor is not agreeable to a certain provision of the contract, he or she could negotiate with the entity to make changes.
Over the past few years, cities and states across the U. S have been advocating for its citizens to "buy local" in an effort to boost community business success and, ultimately, strengthen local economies. But, now, businesses of all sizes and ages have an expanding avenue by which to reach their growth and revenue targets. Especially for those in the IT sector who have the resources and willingness to compete for public sector contracts. Most businesses with a government-centric sales strategy look for solicitations at the federal level first. While the federal government is currently focused on reforming and reducing its IT spending, state and local governments agencies are committing more money than ever to technologies that will enable them to execute on their smart city modernization initiatives; strengthen their cybersecurity systems; and improve citizen services through the expansion of e-government systems; among other programs.
By the time an agency has worked through all the details of what they need to buy and publishes a bid or RFP online, vendors might see the public bid deadline often 21 days out and conclude it is not enough time to respond. However, vendors can learn about upcoming projects long before the bid or RFP is published. Vendors can leverage agency spending and planning data such as past procurement history, agency budgets, capital improvement plans and term contracts and learn about upcoming work months or years in advance. Vendors can utilize agency information to identify key agency contacts such as the procurement officer, buyer or decision maker on the project — then connect with these individuals by email or phone to build relationships. As a vendor, you can learn about upcoming projects in advance and become a valuable resource to those agency contacts to help them better construct their next bid or RFP. Establish yourself as an expert in the market and position your business for success in your next bid or RFP response. Vendors might assume only the large businesses will win the contracts.