If you've been doing business with the government for any length of time, you've probably noticed that the marketplace is extremely competitive. Niche companies often know exactly who their competitors are and may be vying for contracts against only one or two other companies. Companies that offer a broader range of services must also constantly be on the lookout for new players entering the field. Regardless of company size or area of expertise, market intelligence is a vital component of any government-contracting campaign.

Many companies, especially small businesses, make the all-too-common mistake of surveying market data once and assuming the competitive landscape will stay the same. By researching the market regularly, you can plan ahead so that your business can respond to any upcoming challenge – or seize any upcoming opportunity.

Step One: Competitive Market Research

If you're going head-to-head with other bidders on government projects, it's important to know who you're up against. Regular competitive research helps you plan your strategy. Once you have a sense of your competitors' strengths and weaknesses, you can better position the value propositions of your product and your company's strengths and expertise when writing proposals.

Also consider conducting your competitive market research by region to seek out areas that are currently underserved in your market. After all, the best defense is a good offense!

Step Two: Market Intelligence

The complement to competitive research is ongoing market intelligence. A lot of companies turn to government projects as a reliable source of work; after all, the government will always need goods and services, and a government agency is not prone to fold under economic pressure as a private business would be. However, government spending fluctuates with the economy just like private-sector spending: lean times are lean for everyone. In an economic downturn, that means fewer opportunities for the same amount of competitors. So planning ahead becomes integral to your government contracting strategy.

Tracking market trends and purchasing activities by both time of year and region will help you make the smartest decisions possible. Having a solid overview of the current state of your market helps you allocate time and resources and target the contracts you have the best shot of winning.