Company managers new to government sales often view governments as bureaucratic bodies from another world, imbued with strange and mysterious procurement rules, rules designed to confuse and even intimidate.

Successful managers, though, adopt a different view. They know, or one day discover, that in government people buy, not agencies. Rules can tie government buyers' hands a bit, to be sure, but these rules don't turn them into robots. Government buyers are people with the same general motivations and inclinations we all have, rules or no rules.
Government folks buy from commercial folks they know and trust. Their successes and future promotions depend on the value of the products and services they buy and, because of that, they want to be assured that their vendors will perform.

It's not just about getting the best deal for the taxpayer. (Although certainly a factor, in truth "taxpayer protection" is often a fuzzy, remote concept.) It's about getting the best deals for themselves and the people they work with.

These days, more and more government IT functions are outsourced to private firms. Government buyers and particularly program managers (or end-users) view IT vendors as extensions of their internal IT staffs. Often the government employee part of the internal staff is minimal or nonexistent. The effectiveness of their programs and their personal job performances depend on the quality of the vendors they select. Is it any wonder that they want to do business with people they know and trust?

Commitment

Entering the government IT sector without a complete commitment on the part of management is like rock climbing with only a mild and passing interest. You must commit -- and be serious about it -- or you're going to get hurt.

Commitment is not just a willingness to spend money. It may mean management commitment and a significant dollar investment for medium to large companies. For small businesses, it could mean management focus and attention coupled with a modest small investment.

As an example, a small computer store located in a state capital could tackle state agencies and federal agencies located nearby by --

• finding the purchasing decision-makers for personal computers in these agencies, and
• making sales calls to these people just like they do for commercial customers.

But company management must establish and support a program to get this done. They should --

• assign the best salespeople to do it,
• monitor their progress,
• establish sales goals, and
• make a few of the sales calls themselves to find out firsthand what government sales is like in the real world.

Focus

In the government marketplace you must focus your sales efforts.

The government market is nearly $800 billion dollars spent by about 85,000 agencies and over 17 million people. It's an immense market composed of thousands and thousands of market segments separated by different agencies, geography and products and services.

Like any immense complex market, the key to selling within it is to first break it down. Ask:

• Who buys what you sell?
• Where are these buyers located?

For most IT companies, it's wise to think locally for two reasons:

• Buyers prefer working with local companies.
• Your costs of doing business will be lower.

As a general rule, find success locally before you branch out.

Relationship Sales

In the government IT sector, relationship selling is everything. Yet, as we all know, establishing relationships takes time. How many amongst us met our future spouse, had a few drinks, then tied the knot the next week? Few. For most of us, it took some time. Same is true of the government IT sector.

One federal IT consultant says that more than 80 percent of the companies that have sought his advice on how to enter the federal market have, in the end, decided not to. Why? They're not patient enough. They hear about the new opportunities in federal IT, hope for quick success, and then they don't take the hard facts real well.

New entrants can expect to see sales cycles of half a year to 18 months. Add to that the sometimes inevitable costs of getting on the GSA Schedule (with consulting fees ranging from about $10,000 to $30,000), and the news can be a bit discouraging.

And yet companies that stick it out can do very well. The rewards to be found in the end are reliable, long-term and often very lucrative.

You must sell to end-users and official buyers. The importance of one verses the other in your sales focus depends on procurement size and product/service complexity. For large complex projects, you generally focus more on the end-user. The closer the product or service is to a commodity or standard commercial product, the more you focus on the official buyer.

Growing a New Customer

A good chunk of your government business will come from existing customers and from new customers where a relationship has been established through existing customers.

View a new government customer as a seed to be nurtured and grown. Establish that personal trust relationship with the buyer and end-user. Then emphasize growing the new customer into a large, ongoing one.

If you watch public procurement announcements you will see many sole source announcements. Most of these contracts are really follow-on contacts for vendors that the customer knows and trusts. In most cases it is the only practical way for the government to continue the work or expand their installed equipment.

Subcontracting/Teaming

Often subcontracting or teaming is the only answer for small businesses entering the market. Working through a prime can reduce the market entry time, reduce sales costs, and increase your probability of actually winning some business and gaining government experience.

For example, your company might be a reseller with the authority to generate orders under a manufacturer's GSA Schedule. In that case, you could enjoy the power and ease of GSA Schedule selling with less up front cost and hoops to jump through.

So we've covered the basics. Now, how do you proceed with a successful sales program? We'll get into more detail in the next several installments. Stay tuned.