People and the Federal Sales Process

As we have mentioned repeatedly in this series, people drive the federal sales process. The very lowest level in the proverbial food chain is you (the commission-hungry, federal salesperson and your revenue-starved boss). Your goals and self-interest are obvious - commission, revenue, and profit. Nonetheless you can't just hit and run; you need long term, sustainable revenue. One can only achieve the aforementioned goal through consistent contract performance (services) or, in the case of products, by consistently delivering a high value product. In short, you need a strong, established relationship with the federal customer.

The pivotal or critical person in the sales process is the federal end user, also known as the federal buyer who uses what you sell. Like you, this person is motivated by self-interest. The end user's personal job performance and future promotions depend on the performance or quality of what you sell him or her. The foregoing is especially true in the federal sector where most programs are partially or completely supported by contractors rather than in-house staff.

Federal end users have a great deal at stake in determining what services and products they buy. In many instances, a bad choice made by an end user could have a major impact on his or her career. Accordingly, the end users are exceptionally risk averse. The end users seek contractors that they know and trust and remain loyal to those contractors as long as they perform. Although the relationships with end users are difficult to form, they are even more difficult to break up once the relationship is established. In summary, the three "R's" of federal sales are relationships, relationships, and relationships. Of course, all is not perfect in the relationship world. The end user can jettison your company very quickly if you don't perform or deliver. Unfortunately, you can sometimes even be sacrificed when the performance problem wasn't yours.

Let's go back to our discussion concerning the federal end user. The person making the buys wants to ensure that the purchases are made efficiently and according to the rules. Notice we didn't say that their role was to buy at the lowest prices or to create competition. Most official buyers were overjoyed at the arrival of the GSA schedules program because it allowed them to buy goods or services in the most efficient manner possible. Moreover, schedule buys are made under a very defined set of rules thereby lowering the risk for the federal end user. Prior to the arrival of the GSA schedules program, the likelihood of a federal end user being able to make an "efficient" buy was almost zero.

With respect to federal buys, there are people who are peripherally involved in the process - members of Congress, the small business specialist and the minority- or women-owned business advocate. It may come as no surprise that the interests of these peripheral players are self-motivated as well. In the instance of the member of Congress, his or her motivation is to get re-elected. The specialist or advocate wants to improve his pay scale. As a result, these persons may help small businesses, women-owned, or minority-owned businesses as a group but they do not necessarily promote the interests of an individual company.

The prime contractors, of course, care most about the bottom line (revenue) and very little about the individual subcontractor. The best way for a company to crack the federal market is to establish a relationship with the federal end user, not the prime contractor. Several methods for garnering the attention of a prime contractor are as follows:

  • A federal end users strongly suggests that a prime contractor take you on as a subcontractor. This usually occurs because you don't have a GSA schedule the end user can use to buy from you directly. Remember that the prime contractor will first suggest that they can meet the end user's need.
  • Your company has made a sale to a federal end user and you are bringing business in the prime contractor's door.
  • Your company offers something that the prime contractor can't produce in-house and that service or product is something the prime contractor needs.
  • The prime contractor has an immediate need that it cannot fill in-house such as a service need in a specific geographic area where they don't have coverage. Although the playing field may not seem level, it's unreasonable to expect a prime contractor to act any differently. Prime contractors once went through the same market-entry struggle so your goal is to become one of them. Once you win your first contract (probably through a GSA schedule), you are a prime contractor and you have established your first customer relationship.

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