Dr. Renae Sanders
For many small businesses becoming a certified vendor at the local, state, or federal government level is an important step toward diversifying the client base and income stream. Certification is recommended for all eligible businesses, but pursuit of any government contract should be a strategic move for businesses. As you prepare, the following will help you avoid wasting your time and resources:
Establish Clear Sales Goals
Businesses should have clear goals for the types of business they are pursuing and which certifications are needed to achieve stated goals. Only pursue certifications that are most recognized by the organizations or entities with which you wish to do business.
There are several certifying agencies at each level of government, but businesses must also investigate which entities accept certifications by other agencies. For example, you may need only a state or regional certification to enter the supplier diversity program at large corporations. Knowing your target audience helps to narrow your scope and focus your marketing efforts on specific businesses or entities.
Learn the Lingo
Pursuing opportunities with government agencies also comes with a vernacular that is necessary to master to be successful in this space. A term like “lowest responsible bid” is quite telling and suggests business owners should be (1) operating at its most efficient level and (2) understand that egregious markup of services are less likely than in the past. Lowest, responsible bids means the granting entity already has an informed idea of the costs for the project, so unless your bid has a valid, and compelling reason to be higher than your competitors, the bid that meets the needs of the project with the lowest price will win the bid, provided all other requirements are present.
Competition for the largest contracts is stiff. Many agencies are loath to displace a known entity with an unknown player based on what is written in the bids or certification applications. New players must bring their “A” game. To win big in government contracting, a solid track record of performance, stability, and sustainability in related business activity along with great timing is paramount. Tell your story, better yet, get others to tell your story to key players for you.
Establish a Solid Marketing Strategy
Government agencies are a market segment just like any other segment. As such, a marketing strategy specific to this target group is a necessity. Simply having space in a vendor’s database will yield minimal results unless an aggressive marketing strategy is employed. Keep in mind, the sales cycle for each level of government and agency are different, but few are instantaneous. Landing a multi-million dollar contract can take years.
While many bid opportunities are issued at the state and local levels, the level of competition for these contracts is also high. Decision makers who have built relationships with existing contractors are more like to stick with a known entity over a new comer.
Remain Abreast of Trends
The time spent between pursuing and waiting for your big break is also the time where additional training and preparation should be obtained for leaders and key employees. For instance, LEED certification and training is a growing requirement among companies seeking large contracts with government and large corporations. Understanding your role in the social and environmental space is of growing importance and increasingly large general contractors, government agencies, and large corporations want to ensure small businesses will add value and strengthen their efforts in the sustainability areas.
The bottom-line is there are numerous, good reasons to pursue certifications. However, developing a solid strategy for how you will leverage them for your business is a critical step in the process. There are many companies that offer services to assist businesses with obtaining certifications, just be certain find a partner you can trust, that is knowledgeable and offers real value to you and business.
Dr. Renae Sanders is the Managing Director at KRS Consulting, LLC, a management consulting firm specializing in organizational development, growth, and relationships. Believing people are the link between strategy and success, Dr. Sanders works with organizations, leaders, and managers to strengthen internal practices and relationships. Email firstname.lastname@example.org to book an engagement or meeting with Dr. Sanders.