EFFECTIVELY MARKETINGTOGOVERNMENT BUYERS

Cambria Rowe Business CollegeMay 13, 2011

TODAY’S OBJECTIVES♦Keep you awake.

♦Tell you where you can get help when you need it.

♦Tell you EVERYTHING there is to know about marketing to government buyers.

OUTLINE♦ Introductions and assumptions.

♦Marketing defined.

♦Why sell to the government marketplace?

♦Prerequisites.

♦Know yourself.

♦Who needs you?

♦How government buyers buy.

♦Marketing tools.

♦INTRODUCTIONS

♦AND

♦ASSUMPTIONS

PTAC OVERVIEW♦A nationwide

network of local offices that facilitate business participation in government marketplaces.

♦Funded and administered by the Defense Logistics Agency (DLA).

PTAC MISSION

♦Maximize fast reliable delivery of goods and services to Federal, state, and local government agencies, which helps to improve the quality and lessen the cost of those items.

PTACS HELP GOVERNMENTS BY:

♦ Improving the knowledge, availability, and capability of the nation’s supplier base.

♦Providing enhanced competition within the government supply chain.

♦Strengthening the nation’s industrial base, which improves our global competitiveness and helps to protect our national security.

PTACS HELP BUSINESS BY:♦Evaluating their capabilities to do

government work.

♦Assisting with contracting/subcontracting registrations.

♦ Investigating government markets and relating relevant opportunities.

♦Assisting with marketing strategies.

♦Reviewing bids and proposals.

♦ Interpreting regulations and policies.

PTACS HELP BUSINESS BY:♦Providing training.

♦Connecting government customers with contractors and subcontractors.

♦Making referrals to other business service providers.

♦Providing specifications and standards.

♦Answering questions.

♦Etc. etc. etc.

WHAT PTACS DON’T DO♦Serve as an official representative or

agent of your business.

♦Prepare bids/proposals for you.

♦Make your business decisions.

♦Release information about you without your approval.

♦Accept compensation or gifts.

WHAT PTACS EXPECT OF CLIENTS

♦Have a local place of business.

♦Be a viable government contractor and work with us to improve your capabilities.

♦Provide information about your company and its operations.

♦Actively pursue procurement opportunities.

♦Submit quarterly job and contract data and an annual client satisfaction survey.

♦E-commerce capability

ANNUAL PTAC IMPACTS♦Assisting the Federal government in

procuring over $15 billion in goods and services via 95,000 contracts, a return of $600 for every $1 spent on PTACs.

♦Performing 200,000 counseling sessions with 55,000 clients.

♦ Introducing 22,000 new clients to government contracting.

♦Helping to create or retain 320,000 jobs.

MORE ABOUT PTACS♦ JARI PTAC

• www.jari.com/services_procurement.html

♦PTACs in Pennsylvania

• www.paptacs.org

♦All PTACs

• www.aptac-us.org

♦Defense Logistics Agency (DLA)

• www.dla.mil

TAKEAWAY

♦PTACs are sources of expertise that can assist you with many aspects of doing business with governments at the Federal, state, and local level.

CLASS ROLE CALL♦Your name and company name.

♦Your title.

♦What your company does in 5 words or fewer.

♦What you are hoping to get out of today’s class.

ASSUMPTIONS FOR TODAY♦You are “basic” computer savvy:

• You can open a browser.

• You can load and navigate websites.

• You can use search engines.

• You know what “plug-ins” are, what each is used for, where to find them, how to install them, and how to use them.

♦ You are “basic” government contracting savvy.

♦MARKETING DEFINED

MARKETING 101♦Class interview: What is “Marketing?”

♦Some other thoughts:

• Simple: The process of interesting potential customers and clients in your products and/or services.

• Complex: An integrated communications-based process through which individuals and communities are informed or persuaded that existing and newly-identified needs and wants may be satisfied by the products and services of others.

SUCCESSFUL GOVERNMENT MARKETING . . .

♦ . . . begins with thinking through what kinds of problems you solve best, and then focusing on getting that message to the agencies that most need those problems solved.

TAKEAWAY

♦With the client as the focus of its activities, marketing is a business tool used to create clients and to keep clients by informing them about how you can meet -- or even better, exceed -- their expectations.

♦WHY SELL

♦TO THE

♦GOVERNMENT MARKETPLACE?

A FEW MYTHS♦“With all that spending, there’s gotta be

something you can sell. All you need to do is enroll in CCR, get on the GSA Schedules, look on FBO, and before you know it you’ll win an RFP and be rolling in $$$. #@*& yeah!”

♦“It’s all rigged for the big guys or those with inside connections.”

♦“It’s so complex you’ll never understand it.”

♦“A special certification will win you all the business you can handle.”

A FEW CONVENIENT TRUTHS♦U.S. governments spend about $4

trillion each year.

♦They buy EVERYHING!

• Aerospace, ground vehicles, security.

• Information technology.

• Construction.

• Energy.

• Professional services.

• Food, clothing, shelter.

OTHER REASONS♦Typically want/need to work with

small business.

• Target quotas and set asides.

♦Spending is relatively consistent compared to the private sector.

♦Pays bills on time.

♦Decision making is transparent.

• Possibly several individuals, but you’ll know who they are and what they based their decision on.

TAKEAWAY

♦Government business can be lucrative, and government buyers are typically good customers/clients. However, you do need to know how to do business with them to be successful.

♦PREREQUISITES

YOUR BIG PICTURE BUSINESS PLAN SEZ:

♦“Set asides look like low hanging fruit.”

♦“I want to grow my business into new market niches.”

♦“I want to balance my existing commercial business with some government business.”

♦“I know I can fill a need that the government has.”

♦“This recession is killing me. My cash flow is drying up. I need more business NOW.”

QUESTION YOUR READINESS♦ Does government business strategically fit

with your business plan?

♦ Working capital: Getting government business may take years. Can you survive financially until you get your first government paycheck?

♦ Track record: One of the most important considerations for government buyers. How have you satisfied previous clients with similar problems?

♦ Capacity: Do you have the resources to take on government work?

PRELIMINARY MINIMUM REGISTRATIONS

♦Federal Government:

• CCR (DUNS, NAICS, etc.)

• DSBS

• ORCA

♦Pennsylvania Government:

• PA DGS

• PennDOT

♦Other States / Regional / Local

♦Prime Contractors

OTHER REGISTRATIONS♦ Federal Government:

• Agency specific.

• Socio-economic classification: HUBZone, SDVOB, WBE, MBE/SDB/8(a), Vet, AbilityOne, Native American, Mentor-Protégé.

• GSA schedules.

♦ Pennsylvania Government:

• Socio-economic classification.

• COSTARS, ITQ.

♦ Other:

• Socio-economic: LGBT.

TAKEAWAY

♦Do an internal assessment and perform the preliminary activities you need to do before you market yourself to the government.

♦KNOW YOURSELF

♦ In other words, what are the features of your company and the benefits those features bring to doing business with your company?

WHAT DO YOU DO?♦Construction: General contractor,

specific trade, buildings, roads, bonding limitations.

♦Professional, technical, or labor supply: Technology development, training, janitorial, non-construction trades.

♦Commodities: Commercially available items. Can buy with a credit/debit card.

♦Specification manufacturing: Custom-built items.

WHAT ELSE IS IMPORTANT TO CONSIDER?

♦Size.

• Only small businesses can compete for Federal contracts offered between $3K and $150K.

♦Socio-economic classifications.

♦Geographic limitations.

• How far can you provide products / service?

♦Certifications and accreditations.

♦Green?

WHAT ARE YOUR CORE COMPETENCIES?

♦The fatal mistake: “We can do everything and anything, and if we don’t, we’ll get right on that!”

♦“Core” is not everything you do, but the major expertise areas of your firm.

♦A fundamental, unique ability or main strength that is not easily imitated and provides value to clients/customers in a given field creating a competitive advantage.

EXERCISE 1: CLASSIFY YOUR PRODUCTS

♦Create a list of your product and service keywords.

♦Locate the NAICS codes for your product and service keywords.

• www.census.gov/eos/www/naics/

♦Locate the FSC or PSC codes for your keywords.

• www.drms.dla.mil/asset/fsclist.html

• www.outreachsystems.com/resources/tables/pscs/

SOME ADDITIONAL IDS♦NIIN: National Item Identification

Number.

• 9 digit. 2 digit country code followed by 7 digit Federal Catalog System (FCS) code.

♦NSN: National Stock Number.

• DLA items. 4 digit FSC + 9 digit NIIN.

♦NIGP Commodity Services Code: National Institute of Government Purchasing.

• Used by 1,400 state and local government entities. 3, 5, 7, and 11 digits.

WHAT DO GOVERNMENT BUYERS LOOK FOR?

♦ Class interview: What do you think government buyers look for in a vendor?

♦ Survey Says:

• Reliability/Stability

• Timeliness

• Relationship/Partnership

• Good Communication/Responsiveness

• Honesty

• Can follow procedures

• Quality

DIFFERENTIATION STRATEGY♦Government business is just as

competitive as commercial business.

♦Requires a clear value statement that puts your business above other potential contractors.

• Relates to specific problems of a specific government agency you are targeting, if possible.

♦What is it about your company, services, people, products, etc. that will allow the purchasing decision makers to recommend you over your competitors?

ULTIMATELY: THE CAPABILITIES STATEMENT

♦A briefing that tells potential government clients what you can do. It communicates your best values and the results your clients should expect from you.

♦Common elements: Name, demography, history, problem/solution, expertise, resources, certifications, key features and benefits of offerings, successes, differentiators.

♦Styles: Brochure, booklet, html, pdf . . .

♦Guidance and examples at www.jari.com.

EXERCISE 2: CAPABILITIES STATEMENT

♦Write a short paragraph (no more than two or three sentences) describing what your company “does.”

♦“Bulletize” your core competencies.

♦ Identify a differentiator and draft one to three sentences explaining it to a client. Focus on why this differentiator is a reason for people to do business with you.

♦Homework: Revise or create your 1 to 2 page (max) “introductory” capabilities statement.

TAKEAWAY

♦ If you don’t know yourself the way government buyers want to know you, you won’t be successful in this market.

♦WHO NEEDS YOU?

A TARGET RICH ENVIRONMENT♦ Federal government agencies.

♦ Military branches and related.

♦ Military installations.

♦ 50 state governments plus territories.

♦ 3,034 U.S. county governments.

♦ 19,400 municipal governments.

♦ Quasi-government: Public authorities, airports, hospitals, school systems.

♦ Prime contractors and high-tier subcontractors.

♦ www.usa.gov has an A-Z index of Fed/State.

EXERCISE 3: CLIENT QUICK FIND

♦Perform a Google search (or use your preferred search engine) to identify as many military installations in PA as possible.

♦Find the supplier pages and determine if an installation might be a buyer of your products and services. (If you can’t find a link, use the site search if available for “supplier” or “supplier diversity” or “doing business with” for starters.)

♦Extra credit: Look in OH, WV, and MD.

TARGETED MARKET RESEARCH APPROACHES

♦Class interview: What marketing strategy information can you get from a procurement history / backcast?

♦Federal:

• www.fedspending.org

• www.usaspending.gov

• www.fpds.org

• www.ffata.org

TARGETED MARKET RESEARCH APPROACHES

♦Pennsylvania:

• www.patreasury.org (e-Contracts)

• www.emarketplace.state.pa.us

EXERCISE 4: PROCUREMENT HISTORY

♦Visit at least one of the Federal procurement history websites and identify an agency that has previously bought your products or services.

♦Visit at least one of the Pennsylvania procurement history websites and identify an agency that has previously bought your products or services.

TARGETED MARKET RESEARCH APPROACHES

♦Class interview: What marketing strategy information can you get from a procurement projection / forecast?

♦Federal:• Acquisition Central

(https://www.acquisition.gov/comp/procurement_forecasts/index.html)

♦Pennsylvania:

• www.emarketplace.state.pa.us

EXERCISE 5: PROCUREMENT PROJECTION

♦Visit at least one of the Federal procurement projection websites and identify an agency that has plans to buy your products or services.

♦Visit the Pennsylvania procurement projection website and identify an agency that has plans to buy your products or services.

TARGETED MARKET RESEARCH APPROACHES

♦Class interview: What marketing strategy information can you get from procurement activity?

♦Federal:• www.fedbizopps.gov• www.grants.gov

♦Pennsylvania:• www.emarketplace.state.pa.us

♦Subcontracts:• Prime contractor websites• SBA SUB-Net

EXERCISE 6: PROCUREMENT ACTIVITY

♦Visit fedbizopps and identify an agency that has an open solicitation to buy your products or services.

♦Visit e-Marketplace and identify an agency that has an open solicitation to buy your products or services.

SOME OTHER MARKET RESEARCH SOURCES

♦ News Articles

♦ Business Periodicals/Trade Journals/Specialty Publications

♦ Government Publications

♦ Networking Clubs

♦ Trade Associations

♦ Annual Reports

♦ Business Guides - Dun and Bradstreet, Moody's and Standard & Poors

♦ Electronic Databases

♦ Trade Shows

♦ Walking Around Marketing

♦ Commercial Mailing Lists

TAKEAWAY

♦Selectively identify the most promising government prospects that can use your products and services. Don’t Shotgun!

♦HOW GOVERNMENT BUYERS BUY

VEHICLES, IN SIMPLEST TERMS♦Federal micro-purchases:• < $3000 threshold, typical for credit

card purchases.

♦Supply schedules:• GSA, COSTARS, ITQ.

♦Solicitations:• IFB/RFQ (low price), RFP (best value).

♦Federal reverse auctions:

• www.fedbid.com

TIMING CAN BE IMPORTANT♦Federal fiscal year begins __________

♦Pennsylvania fiscal year begins __________

♦Four quarters of budget flow:

• Q1: Funding may not be complete.

• Q2: Funding flows begin in earnest.

• Q3: Purchasing accelerates.

• Q4: “Use or lose” buying surge

RULES OF THE GAME♦Federal:

• Federal Acquisition Regulation (FAR)

• Online: https://www.acquisition.gov/far/

♦Pennsylvania:

• Department of General Services Procurement Handbook

• Online: http://www.portal.state.pa.us/portal/server.pt/community/procurement_handbook/14304

PEOPLE MATTER MOST: GUIDES♦Federal: OSDBU (Office of Small and

Disadvantaged Business Utilization)

• www.osdbu.gov

♦Pennsylvania:

• Bureau of Minority and Women Business Opportunities

♦Large Primes: SBLO (Small Business Liaison Officer)

• Small business area of website. See www.jari.com.

PEOPLE MATTER MOST: DECISION MAKERS

♦Contracting Officer (CO):

• Cares mostly about: Legal, fair, and proper process. Your readiness to do business.

♦Program Manager (PM):

• Cares mostly about: How best to perform agency mission. Value. Past performance.

♦End User:

• Cares mostly about: Getting the job done with the best stuff to do it.

EXERCISE 7: FIND A GUIDE♦Visit the OSDBU website and identify

the small business rep for one of the agencies you identified previously that buys your products or services.

♦Visit a large prime contractor website and identify one or more small business reps.

TAKEAWAY

♦The government marketplace has similarities with, and differences from, the commercial marketplace. It’s important to understand both. No matter where you market and sell, relationship development is the most important aspect of marketing.

♦MARKETING TOOLS

AN ALMOST ENDLESS LIST♦Business cards.♦Elevator pitch.

♦Capabilities statement:

• “Introductory” for initial contact.

• “Detailed” for capability briefing.

♦Websites:

• www.yourcompanyname.com.

• Directories. (CCR, DSBS, PA Sourcenet, Business)

• Social media.

AN ALMOST ENDLESS LIST♦Direct mail. Snail and electronic.

♦White papers and news articles.

♦Telemarketing.

♦Conferences and trade shows.

♦Ads.

♦Agency outreach and matchmaking events.

♦Pre-proposal notices.

♦Lobbyist.

TAKEAWAY

♦Many different avenues exist for connecting your markets’ wants and needs with your company’s products and services..

♦WRAP - UP