If you are under the impression that government sales are only for large businesses, think again! The US government offers plenty of opportunities specifically tailored for small businesses. As the largest single buyer of goods and services in the world, that means there’s room for businesses of all sizes in government sales. Whether you’re a small LLC or even a sole-proprietorship, you could potentially get into government contract bidding.
However, as we make sure to cover in our government sales training for small businesses, just because government sales are accessible to small businesses doesn’t mean it’s easy. As with any business venture, there are both risks and rewards. Understanding the pros and cons can help you decide if government sales are right for your business.
The biggest benefit to working in government sales is that the US government basically buys anything and everything – and in huge quantities. Would you like a steady customer who’ll clear out your stock regularly and keep coming back for more? That’s an entirely possible scenario in government sales, particularly if you can attach yourself to a multi-year IDIQ contract.
Also, it’s worth keeping in mind that the government actually has mandated that they must give a certain portion of their business to small operations. In some -but not all- cases this can make a contract bid a cakewalk if you’re the only small business bidding in a certain niche. Being a minority small business can give you access to even more small business set-asides to make contracts less competitive.
Finally, as part of that mandate, the government offers significant assistance to small businesses, including one-on-one counseling, to make the process easier.
Selling to the government carries some risks as well.
The biggest drawback is the complicated bureaucracy. Even the slightest mistake in filling out forms, or coding your products/services, could result in your bid being rejected. You will have to invest significant time into navigating the red tape.
Also, for smaller businesses, profit margins can be lower than in the private sector. Contrary to popular belief, the government doesn’t usually overpay for basic goods and services. They’ll expect competitive pricing and have the contracts teams to enforce their rules. The reward is in how steady their business is, not necessarily the gross profits.
Our government sales training programs can help you overcome those drawbacks and get the most from government sales. Contact us to learn more!