The Upcoming Buying SeasonPosted: April 23, 2014
It’s been estimated that the government spends between 60-75% of its contractor dollars in the period between June and September (known as the “buying season”). A third of year, but two-thirds of its total contractor dollars (note this doesn’t include salaries, buildings, or other costs that go on all the time like entitlement payments, social security, and unemployment).
So money comes in at the upper levels and then flows down through the various organizational structures, with individual programs getting their budgets to allocate in the first quarter of the following calendar year.
That starts the sequence of gathering requirements, documenting them, establishing how they’re going to be competed, going through the legal process, putting out RFPs, and when all that was said and done it’s possible they wouldn’t have things awarded within the same fiscal year.
Meanwhile, there is a lot of continuing activity that might require a short contract action, for example a maintenance contract on some copiers and printers. Not changing over to a new supplier or anything, just renewing an existing contract to keep things working. Well, that kind of activity often also fell into the final quarter of the year.
What makes this particular buying season relatively unique is that it’s the first time in five years we’ve had an actual budget, and 2015 could be disastrous. They deferred sequestration for a year or so, which just puts more and more pressure on the people at government agencies. They really have to spend the money.
We’re not on a continuing resolution anymore. A continuing resolution limits the contracting that can be done for brand new stuff – you can continue or recompete, but you can’t change scope. It’s frustrating for everyone – and it’s designed this way to make things so onerous that Congress will be motivated to get the job done and put a budget together.
The good news is that we have a budget; the bad news is we’ve got to spend it.
So how do small businesses get work in this compressed buying season? A lot of this can be handled with first what’s called a “simplified purchasing agreement” – many agencies can spend up to $50,000 and others like Defense can use small purchase authority to spend up to $250,000. There is no competition for these awards, and small businesses can use this to get a foot in the door. Once you get started, you can work on competing for something bigger down the line.
In fact, my old friend Guy Timberlake of the American Small Business Coalition helps small business owners find success in government contracting, including how to use simplified purchasing.
If you’re going to stuff a year’s worth of spending into four months, you’ve got to find faster, more efficient ways, including these non-competitive spending options. These opportunities are strictly dependent on relationships. The customer – whether a contracting officer or government requiring group – makes their decision based on who they know. It’s exactly what Judy Bradt and Matt Falls have been talking about on this blog. In this compressed buying season, relationships are the ONLY thing that matters. If you don’t have them, you’re not going to get the business.
The second thing you’ve got to have, and this is a little more difficult, is a clear-cut strategy for how to get a contract without competition. Small purchase limits and simplified purchasing is one way your customer can award something to you without having to go through the timeframe necessary for a competitive result.
The other way is through purchasing vehicles that allow someone in a government agency to tell a contracting officer to put out their requirements in a BPA or IDIQ to a specific company (in this case, yours).
Another possibility, though less desirable, is that government agencies can award sole-source contracts to those kinds of companies companies with special certifications, using something called a J & A (justification and authorization).
Those are your three options. You either have something small enough to fit into simplified purchase authority, a contract vehicle with your name on it, or you’re one of those specially certified folks.
Fundamentally, a small business must be able to understand these options and be able to clearly convey to the customer how to use one of them to hire you.