By Freida Curry
Women’s Business Development Center
The end of the federal government’s fiscal year is quickly approaching. In a few months, on September 30, 2014, all federal agencies will lose any appropriated dollars that have not been obligated. In other words, if they don’t use it, they lose it! Consequently, the last quarter (July through September) of the federal government’s fiscal year becomes a spending frenzy with agency buyers trying to spend all of their dollars. One of the reasons why agencies don’t want to lose these dollars is because they don’t want to have future budgets reduced if it is determined that they are requesting higher budgets than they really need.
Since agency buyers have to move fast, they are looking for opportunities to make efficient and speedy purchases. Consequently, they tend to use buying vehicles that help to make that happen. These often include:
· GSA schedules – firms are vetted and prices have been pre-negotiated
· 8(a) certified firms – for sole source contracts the RFP and bidding process is eliminated
· Set-aside firms (8 (a), women-owned, veterans, small businesses, HUBZone, etc. (see FAR Part 19) – this helps buyers to make quick purchases and meet their set-aside requirements
· Micro and credit card purchases – agencies can spend up to $3,000 for any business related purchase, even from vendors with no contracts.
So, how can your small business be postured to participate in such a whirlwind? Ideally, you don’t want to wait until the last quarter to get started, but rather, start getting to know targeted agencies well before the start of the fourth quarter. Since people are more likely to buy from people they know, it is essential for a contractor to get to know the relevant personnel at the agencies in which they plan to market their goods and services.
For small businesses, a great place to start is by establishing a relationship with the agency’s small business specialist – your supportive focal point to the agency. It is imperative that you know your customer, its challenges, buying habits; what, when and how they buy. With this knowledge you can identify and present the benefits and value you provide, the solutions you offer buyers, and how you can help the buyers to meet their needs.
These strategies are essential all year long and can lay the foundation for you to be in the running when fourth quarter rolls around. To strengthen your competitiveness, you must make it easy for agencies to buy from you:
1. Know and use, the agency’s preferred purchase vehicles
2. Accept credit cards so you can take advantage of micro purchases
3. Consider teaming to enhance your capabilities
4. Use the NAICS codes that most accurately describe your capabilities and align with the codes in which your targeted agency buys
5. Offer year-end incentives or discounts to make it attractive (and easy) to buy from you
6. Acquire as many set-aside designations for which you qualify – especially those where your targeted agency is not meeting the goals
7. Modify your GSA schedule, if possible, to add items that are typical year-end purchases by your targeted agencies
8. Keep your relationships active and strong; keep your materials and website up to date; and make it easy for agencies to reach you.
The federal government spends hundreds of billions of dollars every year on goods and services, and is required to spend at least 23% of that with small businesses. So, do all that you can do to make sure when the fourth quarter buying frenzy begins, you have positioned you and your business to be a viable competitor ready to win contracts.
Are You Ready
for the Federal FY-End Buying Frenzy?
www.wipp.org