Business development within the public sector is a difficult and time consuming endeavor, even for the most experienced sales representative. The first step to developing a sustainable relationship with a new public sector client is to understand their procurement process.
Close to 80% of government contracts never go out to bid. The agency is not required to conduct a formal purchasing request if the contract amount is below their stated purchasing threshold.
For example, purchasing thresholds for the City of Boise, a DemandStar partnered agency, are detailed below :
- Goods and Services contracts with an estimated value over $25,000
- Construction contracts over $50,000
- Professional Services over $25,000
Contract opportunities with values lower than those listed above are considered informal bids and may not be advertised. The Boise Public Works Department is responsible to solicit quotes and may solicit bids or proposals verbally by phone or in writing by mail, fax, or electronically.
Agencies rely on their vendor lists to solicit these unadvertised bids. Just because you are on a vendor list doesn't mean the phone will be ringing off the hook. Focusing on those key decision makers within the agency, and start to build a relationship with them; these decision makers are the people who can help get your good/service specified into the larger-dollar projects. For more information on getting your company on vendor lists follow the link: http://www.onvia.com/business-resources/how-get-approved-vendor-lists
Once you have started cultivating a relationship, here are a couple of tips to keep in mind:
- Traditional gifting isn't allowed. This could jeopardize your relationship with the agency, and get you in legal trouble. :
- Getting in early on projects takes some work. Opportunities that don’t necessarily promise instant work such as “on call” contracts are a great way to establish a reputation with the new agency. This reputation can put you in contention larger, more lucrative, projects are available. Consider it an investment that could pay off in the long run.