Everywhere we turn today, we are being told, "diversify, diversify, diversify". Financial advisors tell clients to diversify stock portfolios and investments. Companies are being told to diversify product lines and markets. This advice is easy to give, but hard to execute. Many companies have been in business for 20 plus years and have had many of the same clients -- until now. Now, many have fewer clients placing smaller orders. So, what could these companies have done differently to diversify their markets? One answer is government contracting.

While it is true the federal government buys just about everything, it is not true that government contracting is for just about every company. Entering the government contracting arena has to be a business decision made by the officers of the company and accepted by the person or person(s) who will be responsible for exploring the market, determining appropriate contracts to pursue, completing the paperwork involved, making the product or performing the service, inspecting the quality of the product or service, packaging the product, shipping the product, etc. Are you starting to get the picture? When a company decides to pursue government contracting, everyone involved in the company has to buy-in to the idea and be part of the process.

Is there a market for your product or service?
The first thing you need to determine is if the government buys the product or service you provide. Most federal, state and local government agencies use the Internet to advertise for products and services being sought. You can use these sites to research past and present bid notices. Federal government agencies utilize the web site www.fedbizopps.gov, while the state of PA advertises on the Department of General Services web site, www.dgs.state.pa.us. By conducting this research, you will be able to determine if there is a market for your product or service.

Who is your target market?
You need to know who buys your product or service. Are there specific agencies that make large purchases of your product or service? Again, use the Internet to research who is buying your product or service. Is it the Navy, Defense Logistics Agency (DLA), General Services Administration (GSA), Government Printing Office, etc.? Once you have determined the agencies that typically purchase your product or service, determine how they advertise their needs. For example, the Navy advertises for products and services on NECO, the Navy Electronic Commerce Online system. NECO requires companies to register, and then an email is sent when something of interest to the company is posted on the site. DLA uses a similar system call the Procurement Gateway. Determine if your target market requires any special registration and how they advertise for large and small purchases.

Most federal government agencies post opportunities on the FedBizOpp site. All contracts anticipated to be over $25,000 have to be publicly advertised. Therefore, they would most likely appear on the Internet. However, for small businesses, the target market is often those agencies who procure for small purchases; less than $25,000. These purchases do not have to be publicly advertised. For purchases between $2,500 and $25,000, agencies need to obtain three quotes in order to award a contract.

Determining your target market allows you to research those agencies and determine how they advertise for and award contracts. Every agency has a web site which contains a myriad of information regarding that agency as well as points of contact. All federal government agencies have a Small Business Office. These offices staff individuals who are responsible for assisting small businesses with doing business with that agency. One of the key points you should address with the Small Business Specialist is who buys my product or service within your agency and how do they advertise for small purchases. Some agencies post the information only on their website. Some require companies to complete a bidder's mailing list application. While others use sites such as PRO-Net or GSA Advantage! to locate three bidders. The Small Business Office should be your first point of contact after determining the agencies you need to market. They can provide the additional information needed to market to the correct buyers.

Who are your competitors?
Many times we hear from a company, "we don't have any real competitors." Believe me, when it comes to government contracting, you have more competitors than you realize! Determining your competitors can assist with pricing and marketing strategies. It is important to determine how much your competitors are selling their products or services for and how much the government is paying for those products or services. You can search the award notices on the Internet or subscribe to a service that can provide this specific information

What makes your products or services unique?
It is true the federal government does not need any more suppliers. On the other hand, it is also true that the federal government does need better, more unique suppliers. There are some cases where companies have developed a new product or technology that the government may need or want. In most instances however, the need is already present and currently being fulfilled. You need to determine what sets your product or service apart from the competition. How will your product or service save the government time, money or how will it solve a current problem? These are the things you need to determine so you can effectively market not only your product or service, but also your quality and responsiveness.

I am sure all of this information is starting to overwhelm you. The good news is the SBDC has a Government Marketing Program, Procurement Technical Assistance Center and a Defense Economic Transition Assistance Program that can assist your company with many of these items. These programs are managed by two consultants who can assist you in determining your market, your competitors, etc. They can also set your company up on a bid matching system to receive daily notices of solicitations coming out from federal, state and local government agencies. Talk with your current SBDC consultant or call one of the program's Specialists for more information.