Between now and December, there is going to be a lot of vacant time before federal agencies get their budgets settled and begin to look at contract actions again. Now is the time to be planting seeds and be understanding what’s coming down the pipe.
Here are two key things you want to know about your government customers:
What keeps them up at night?
Remember the last time you engaged your customers in a conversation that wasn’t about the work in your current contract? It could be about baseball (just please don’t ask me about my Nationals), football, a TV show, or a photo on their desk. The point is to open up a dialogue so you can build a relationship.
You want to boost your rapport to the point where you can find out what they’re most worried about. What are their concerns? What keeps them up at night?
If they’re standoffish or don’t really want to talk, just come back to it later, or catch them when they’re sitting with a fresh cup of coffee. Emphasize the reason you’re asking, which is to make sure you’re doing everything you can to help.
Also point out that if you know what’s on their plate now and in the future, you can help with the advanced planning for anything you should be thinking about together.
Whatever your customer is worried about is an opportunity for you to do something to help them – either a new piece of work, or to improve the work you’re already doing. Either scenario will cement your relationship and increase your value to them.
How are they evaluated?
What is the top metric on your customer’s job description performance requirement list, i.e., what’s the number one thing that their boss is evaluating them on?
Do you know that? How can you find out? Obviously, that’s an important issue to that person, but it’s also crucial for you as a federal contractor.
Zig Ziglar said that you can have everything in life you want if you will just help enough other people get what they want. When you know how your customer is being evaluated, you can make them successful. The more successful you can make them, the more successful you will be.
The federal fiscal year closed on September 30th, a time when many federal contractors were out hunting for business (or waiting by the side of the road like a vulture). As Eileen Kent explained in her guest post, it’s likely you were doing a little of both. However, whether you were wonderfully successful with your year-end tactics or not, the issue now is what do you do next?
Here’s an example of how to capitalize on a success. On September 30th, at about two o’clock in the afternoon, someone from a federal agency called a member of our senior leadership team to say, “I’ve got a little money I need to put in your task order, how can I do that?” By 9:30 p.m. I was signing the contract papers.
While this certainly proves that when they want to, the government can move pretty fast, what it shows even more is that relationship building works in federal contracting. Yes, we had all the right things in place to make this happen – there was a vehicle, we had a task order, we’re going to fill the jobs, we’ll start the work.
That is the task execution part. That is essentially what the government is paying us for. But I guarantee we weren’t the only company this agency could have approached. The difference is that we had done our homework up to this point.
We did good work for our client, we kept in touch, and we consistently built our relationship. We didn’t know they had this extra money, in fact, no one we knew was involved, but our customer must have spoken highly enough of us to their colleagues that at the 11th hour they came to us and – sight unseen – gave us the work.
When the contracting officer sent over the fully-executed and counter-signed contract, he copied several people in the agency to say it was done. Some of them actually wrote back – using Reply All – to thank the contracting officer.
We might have stopped there, satisfied with the new order, but that’s not how relationship building works. So here’s what I did next: I replied directly to each one of them with the simple message, “Thank you for your confidence in our company.”
In a month or two, we’ll reach out to them again and continue building these new relationships.
That is what this blog is really about. These simple things. Task execution. Responsiveness. Acknowledging other people. It’s about showing somebody that you’re willing to go a few extra steps. That you value their personal contribution to your activity.
At the end of the day, our customers noticed our commitment to our relationship, leading them to recommend us as someone their colleagues could trust to hand over this bunch of money they had to spend before year end.
“Yeah, these guys will do the job for you.”
Truth be told, that’s the only advertisement that counts. The one that comes from your customers.
I talked to a friend of mine the other day who has been building his small business doing something we did a lot of early on at TAPE. We call that phase of our company history “Rent-a-Bill,” where we did capture management and proposal management for other people.
Fast forward to today, and it was my friend who has filled that role for us, becoming the piece of the puzzle we needed for our own proposal development.
We were discussing his strategy for this capture and proposal work. Instead of hiring a bunch of experienced folks, such as retirees or long-time industry veterans who really understand the ins and outs of federal contracting, he’s been going another route.
For the same dollars it would cost to hire one experienced person, he explained, he can bring on two or even three recent college graduates. Instead of spending the dollars, he spends his time to train them. He knows they may make lots of mistakes and step on some toes, but in the meantime, some of what they build will stick – and they can get around to twice as many places.
It’s certainly an interesting concept. And while I’m sure all of us grey-bearded folks are shuddering, times are changing. While long-timers know lots of people and have good relationships in place, with modern technology, thought leadership platforms like blogs, and sites like LinkedIn, it’s possible to build relationships and trust with people without actually knowing them.
If you’re willing to take the time to train your newbies on all the ins and outs and details about how to be compliant, put together a capture plan, and the other pieces that lead to success in government contracting, you may be surprised and delighted. While it’s true that some of the actions they take will not fly, some may be innovative technological ideas that those of us with grey hair wouldn’t see.
My friend says he’s having a lot of success. It’s an interesting solution to the age-old problem of how to keep costs down, and still cover all the bases of where you want to go to get more work.
What do you think?
This is a guest post by Eileen Kent, The Federal Sales Sherpa
A federal sales hunter scans the landscape daily with his own eyes and locates where the most potential for healthy-sized opportunities appear.
The hunter has been trained by other hunters to seize the moment when an opportunity arises.
The hunter approaches the client on a regular basis, and, when the ideal opportunity presents itself, the hunter “captures it” with a closing mechanism like a GSA Schedule, small business preference, or partner. No one ever heard about the opportunity coming, and never found out when the deal was closed and delivered.
We can only see it after-the-fact in the contract data – exactly how the hunter quickly captured the deal.
A federal sales vulture sits on the sidelines and waits for a lucky opportunity to come out on the public websites like fedbizops.gov.
But, by the time the opportunity “dies,” there’s nothing left in profits but a few scraps – and a lot of other angry vultures still fighting with you for the leftovers.
Look, we all have a little “hunter” and a little “vulture” in us.
A note from Bill:
This is sort of like being a little bit country, a little bit rock and roll (yes, I did like Donnie and Marie), and by the way, both strategies need to be applied judiciously. The hunter lands more of what they go after, because the capture is good, and the customer is ready. But, the vulture can get some tasty scraps in these days of LPTA. At TAPE we do have a scanning process (by vehicle, not FedBizOpps), where we look for the following:
- Know the function absolutely cold, with good past performance.
- Make sure the labor hours are specified. If they want you to guess or figure it out, you’re not going to win.
- Write a good, highly compliant response. Check everything to make sure there are no issues, this is critical because…
- Price that baby low, low, low. Profitable, but low.
Many years ago, I asked a big company, one respected for really doing good capture work, how they treated year end. They were candid, and said they like 2/3 of the work to be captured, but 1/3 will be over the transom, with good past performance, nearest customer neighbor, low price. They won a lot of them (well, great proposal shops can write to anything), and it fueled growth.
Our hunter side has found out from the client that the deal is “coming out soon” and then we want to sit tight like the vulture…… waiting …. waiting…waiting for it to be posted.
But it is advised that while you’re waiting for the postings at fedbizops.gov and end-of-year spending, that you still could be a hunter by continuing to scan the landscape and talk to all of your clients about opportunities now – and in the future. If the opportunity has not hit the streets yet, you may still be able to do something to get them to make it a set-aside or to use a contract vehicle with little competition.
And in the coming year, you want to change your tactics to be more like a hunter all the time….or hire a hunter to comb the landscape, get to your customers in the field, and close the deals quickly and quietly.
For more information about having a federal sales action plan built for you so you can focus on the “hunt,” contact Eileen Kent at 312-636-5381 or visit http://federalsalessherpa.com/.
This post originally appeared at https://www.linkedin.com/pulse/article/20140812023632-5572608-in-federal-sales-are-you-a-hunter-or-a-vulture and was adapted and reprinted with permission.
When TAPE was first founded, my wife (CEO/President Louisa Jaffe) and I were sitting around with not much to do because we were just getting started. So we volunteered with the local chapter of AFCEA (Armed Forces Communications and Electronics Association) to lead their small business program. We were a small business ourselves, so this made logical sense.
Now it did take a little time, to find speakers for the various small business programs, and coordinate to make sure everything went well. But in return, we got incredible business development opportunities.
First of all, we were able to reach out to actual potential customers, and other folks in the local government community, to invite them as speakers. These were no cold calls, but we were still making valuable connections!
Second of all, we always got two free passes to attend the events. That meant one of us could be in the small business program, while the other could be with the “big boys” in the other room – a free networking opportunity.
More than 10 years later, and hardly with much spare time to sit around, we’re still getting involved and we’re still making important connections through those efforts. Louisa, for example, is on the board of the Army Women’s Foundation where she meets all sorts of retired army women now working in the contracting industry.
Down here in Orlando where I’m working with a company we acquired last year, I have been volunteering for a source selection improvement group – an industry/government partner group looking at problems in the source selection process.
This has given me the chance to meet a bunch of people I would have never met otherwise – contracting officers and other companies doing business in the same realm as our Orlando division – and work together to solve problems that affect us all.
These are two very good things, and all it costs is some time.
So get involved – there are government panels, committees putting on networking events, and many other options. You’ll be immersed into the contracting community and as you’ve heard me say many times:
There is business to be found through building relationships.
This is a guest post by Shelley Hall
Effective 24 Jun 14, DOD, GSA, and NASA adopted as final an interim rule amending the FAR to remove the dollar limitation for set-asides to economically disadvantaged women owned small business (EDWOSB) concerns and woman owned small businesses (WOSB). As a result, COs may set aside acquisitions for competition restricted to EDWOSB concerns or WOSB concerns eligible under the WOSB Program at any dollar level above the micro-purchase threshold, provided the other requirements for a set-aside under the WOSB Program are met.
The Women-Owned Small Business (WOSB) Program, set forth in section 8(m) of the Small Business Act, 15 U.S.C. 637(m), authorizes Federal contracting officers to restrict competition to eligible WOSBs or EDWOSBs for Federal contracts in certain industries. Section 8(m) of the Small Business Act (Act) sets forth certain criteria for the WOSB Program, including the eligibility and contract requirements for the program. For example, the Act had stated that contracting officers could only set-aside a requirement under the program if the anticipated award price of the contract did not exceed $5 million in the case of manufacturing contracts and $3 million in the case of all other contracts. Recently, SBA had amended its regulations to adjust these statutory thresholds for inflation so that the anticipated award price of the contract awarded under the WOSB Program must not exceed $6.5 million in the case of manufacturing contracts and $4 million in the case of all other contracts.
Even with this adjustment for inflation, these dollar value restrictions on awards under the program limited a contracting officer’s ability to set-aside contracts for WOSBs or EDWOSBs. As a result, Section 1697 of the National Defense Authorization Act for Fiscal Year 2013, Public Law 112-239, amended the Small Business Act and removed these dollar value limitations. Contracting officers may now set-aside any contract for EDWOSBs or WOSBS under the program if: (1) There is a reasonable expectation that, in industries in which WOSBs are underrepresented, two or more EDWOSBs will submit offers for the contract or, in industries where WOSBs are substantially underrepresented, two or more WOSBs will submit offers for the contract; and (2) in the contracting officer determines the contract can be awarded at a fair and reasonable price. The anticipated contract can be for any dollar amount.
While this is good news for EDWOSBs and WOSBs, it is also good news for the government. The Federal government consistently fails to meet the statutory 5% goal for WOSBs. The purpose of the WOSB Program is to assist agencies in achieving the statutorily mandated 5% government-wide goal for procurement from women-owned small businesses. By removing the limitations on the dollar amount of a contract award that can be set-aside for WOSBs or EDWOSBs, the SBA will be clarifying that there are more contracting opportunities for WOSBs, which should result in more contracts being awarded to this group of small businesses.
This post originally appeared on the Skyway Acquisition Solutions blog at http://skywayacquisition.com/good-news-edwosbs-wosbs/ and was reprinted with permission.
Shelley A. Hall has over 30 years’ experience with DOD. Her experience runs the gamut across the spectrum of government contracting from commodities and services, commercial and non-commercial, simplified acquisition procedures, foreign military sales, systems, to major source selections. In her current job, she holds an unlimited Contracting Officer warrant and serves as a Procurement Analyst for a variety of range and launch support contracts. Shelley also works as a consultant for Skyway Acquisition Solutions.
When you’re recruiting to fill a position as part of an RFP, compliance is a hugely important issue. The candidate must meet the government’s specific criteria for experience, technical skills and certifications to a T.
Believe it or not, I once had a resume rejected for an RFP because the candidate listed their experience with PC DOS, and the RFP had asked for experience with MS-DOS. (They’re one and the same thing.)
It’s absurd, but these things happen. There is no such thing as close enough. You have to remember that the government is not going to interpret, they’re going to measure you against the exact requirement that’s down on paper.
After compliance, it’s time to think about profitability. When you’re hiring for an RFP, you’re not just filling a job within your organization, you’re filling a job that will be billable to your customer. You have to understand what the billing rate translates to in terms of your bottom line, so you determine an appropriate salary.
During the bidding process, you have to first figure out whether you’re in a cost-sensitive environment or not. I wrote about how to compete on price with your salaries in an LPTA environment in a previous post.
You should also consult salary surveys for that particular discipline, to compare other salaries and contract terms. Pay attention also to what your current employees are making, so you don’t anger them and poison your work culture by hiring a bunch of new people at a higher rate.
Finding the right people
These days hardly anyone is using the newspaper to find a job. You have to be in the places job seekers are looking, namely LinkedIn and other social media, and online job boards like Monster.com. For very specialized requirements, you may want to do an insert in a technical association newsletter or an industry magazine.
What are your best recruiting tips for government contracting? Share them as a comment below, or on my LinkedIn post.
This is a guest post by Steven Koprince.
Small businesses were awarded 23.39% of prime contracting dollars in Fiscal Year 2013, a jump of more than a percentage point from FY 2012 levels–and above the 23% government-wide goal for the first time in several years.
According to the recently-released SBA Procurement Scorecard, the government exceeded its goals for SDVOSBs and SDBs, but failed to hit its targets for HUBZones and WOSBs. Despite these shortfalls, the SBA gave the government an overall “A” rating for its FY 2013 performance.
In FY 2013, the government awarded $83.1 billion in prime contracting dollars to small businesses, a rate of 23.39%. The government should be applauded for surpassing its percentage goal, but the percentage is not the whole story. Thanks to spending cuts, overall dollars awarded to small businesses fell considerably–down from $89.9 billion in FY 2012, a year in which the government only managed to award 22.25% of prime dollars to small businesses. In FY 2011, the government awarded only 21.65% of prime dollars to small businesses, but total awards were $91.5 billion. Hitting a percentage target is nice, but doesn’t make up for more than $8 billion in decreased small business spending in the last two years.
The government reached two of its four socioeconomic goals: 8.61% for SDBs (5% goal) and 3.38% for SDVOSBs (3% goal). Awards to WOSBs increased, on a percentage basis, from 4% to 4.32%, but still fell short of the 5% goal. HUBZone awards continued to decline sharply, down to 1.76% from 2.01% the previous year–just more than half the 3% goal.
Among notable agencies, the DoD awarded only 21.09% of prime dollars to small businesses, and missed three of the four socioeconomic goals–including the SDVOSB goal. The SBA nonetheless gave the DoD a “B” grade. The VA performed well overall, awarding 36.21% of prime dollars to small businesses and 19.38% to SDVOSBs. Although the VA missed its WOSB and HUBZone goals, it received an “A” for its efforts. The Department of Transportation received a well-deserved “A+” for awarding 43.34% of prime dollars to small businesses and meeting all four of its socioeconomic goals. As usual, the Department of Energy received an “F,” awarding only 5.71% of prime dollars to small businesses and falling far short on all four socioeconomic goals.
The FY 2013 Procurement Scorecard shows that many agencies are making sustained and committed efforts to award contracts to small businesses and meet their goals. Still, until the government meets all of its goals–including its WOSB and HUBZone goals–I question whether the overall “A” grade was deserved.
This post originally appeared on the SmallGovCon blog at http://smallgovcon.com/statutes-and-regulations/government-meets-fy-13-small-business-goal-hubzones-and-wosbs-fall-short/ and was reprinted with permission.
Steven Koprince is a partner with Petefish, Immel, Heeb & Hird, LLP in Lawrence, KS, with a practice focusing on federal government contracts and small business law. Steven is the author of The Small-Business Guide to Government Contracts (AMACOM Books, 2012), and has published a number of articles on government contracting. Steven has spoken to audiences across the country on government contracting and small business matters, and blogs regularly on similar topics at SmallGovCon.
In this era of LPTA (Lowest Price Technically Acceptable), there are many more times that you might want to bid on something, even though you’ve done no capture or relationship-building work. And the end of fiscal year is a perfect time to take a look at the circumstances in which you might want to throw a bid “over the transom.”
When to bid
- First of all, does the request for proposal indicate that you need secret knowledge to win? For example, do they want a bunch of resumes, many of them for key positions, or do they just give general staffing requirements?
- Are they looking to see past performance that’s specific to their work, or can you show work you’ve done elsewhere that may have the same size, complexity and scope?
- Is there a big emphasis on price? (The more emphasis on price, the less likely the incumbent has an advantage.)
- Finally, how big is the proposal to write, in particular, the technical and management responses? A smaller proposal has less evaluation or subjectivity in play, and less favors the incumbent.
If there are few or no resumes required, if generally applicable past performance is permitted, and if response time is at least two weeks, these are signs you may want to go ahead and consider a bid.
Conversely, run in the opposite direction if a response is required in three days or less. That bid is wired for somebody else. Maybe not the incumbent, but someone. If that somebody is you, by all means get your proposal in, but if it’s not, there’s no reason to waste your time.
How to compete on price
When you’re competing on price, it’s no longer business as usual. You’ve got to understand what is your wrap rate, and what is the wrap rate of your most likely competitors.
The wrap rate is what you add on top of the salaries or hourly rate of the people in your bid. You’ll add a percentage for fringe, a percentage for overhead – costs directly related to the accomplishment of a job, but which are not billable – and then “G&A” (general and administrative). Plus, profit, of course.
For example, if an employee is sitting at your office but their time is billable to your customer, then you would add that portion of rent, their use of computer, etc. because these things are directly related to project rather than for general work in your company.
You would also add a portion for what is called G&A, or general & administrative. This includes costs like your HR department, accounting people, leadership time that is not billable to the customer, and marketing staff.
On top of those amounts, you put a profit. There are formulas you can use to determine your wrap rate, but typically they’re anywhere from 1.5 to 2.5 (expressed in terms of 1.5 (up to 2.5) times the base hourly salary rate). So for someone who’s salary is $100,000, you would charge $150,000 or $250,000 to the government agency.
The bottom line is that if you’re competing on price, you’d better get your wrap rate down. That might mean shaving benefits, but that hurts hiring. The easiest places to cut are your G&A by operating leaner and less fixed charges, and of course, profit. Sadly. Also, don’t hesitate to reduce escalation (a clause that protects you against higher material prices) in short-term contracts; it’s an area where competition might not think about reductions.
Being selected for a bid in a year-end cycle can bring you great revenue. Even if you haven’t done the capture work, use the criteria I’ve outlined above and when appropriate, you can take a chance without the advance work usually required!
This is a guest post by Kevin Jans of Skyway Acquisition Solutions.
Fishing with a cast net here in Florida is fun. In the right place, at the right time of day (and tide), the net is full of surprises: bait fish, a crab or two, a stingray, or even a mullet.
However, cast-netting is a futile and costly way to gain sales – especially as a small business in the Federal market. At best, you’ll stumble upon a few opportunities. At worst, you’ll catch a net full of unqualified leads. Most likely, you’ll end up somewhere in between: spending a lot of time sifting through RFPs hoping to find one that fits your company.
Targeting opportunities is just as important in the federal market as it is in the commercial market. History shows time and time again that a focused strategy wins. In the government market, it can be easy to feel like you are drowning in opportunity. Targeting your efforts is one of the best ways to offset this.
Do you know, really know, what you are fishing for? Why do you target specific agencies? Why are you investing your time on specific RFPs and RFIs? This is not about bid/no bid – this is about deciding whether you should be looking at an agency’s RFPs at all. Or, whether you should be in the Federal market at all. What is your plan? What is your target? What are you trying to catch?
Are you filtering opportunities by NAICS, size of opportunity, and socio-economic set-asides? So is everyone else. What if you fine tuned your search beyond the agency? To a division? To a contracting office? To a specific customer who buys a lot of what you sell? What if you knew that the buyer you targeted actually needed your help and would be excited to know about your company? What if you targeted your efforts to the point that the government customers are calling you to make sure you bid on their RFP? That’s what real targeting looks like.
Save your company time: do not fish with a net.
This post originally appeared on the Skyway Acquisition Solutions blog at http://skywayacquisition.com/targeting-government-rfps-fish-net/, and was reprinted with permission.
Kevin Jans founded Skyway after 16 years as a Department of Defense Contracting Officer (CO). As a CO, he saw many companies struggling in the B2G market. He created Skyway to give these small to mid-size companies access to a leadership team of former contracting officers and to show them how to compete and WIN in the increasingly complex market. Learn more at http://skywayacquisition.com/.