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by GK Strategy 22nd February, 2017
3 min read

6 Top Tips for winning Government Contracts

Back in 2011, a year into the coalition government- then Prime Minister David Cameron unveiled an ambitious pledge at the heart of his trade and investment white paper, to help smaller and medium sized businesses (SMEs) access greater government procurement opportunities. The focus was deliberate – the small business sector is often where successive governments hope to see increased growth. Yet, despite accounting for 50% of the turnover of the UK business economy back in 2011, SMEs won a mere 5-10% of the billions of pounds of public sector work which was available.

The government, in response, announced an aspiration for 25% of procurement spending to go to SMEs by 2015 and what followed over the course of the 2010-2015 parliament can legitimately be described as a culture shift. The government announced in 2015 that it had met its 2010 SME spending pledge a year early – spending roughly around £15bn per year with firms comprised of fewer than 250 people and with turnovers of less than £39m. The success of its SME procurement drive led it to extend this procurement target to 33% by 2020. Yet perhaps the most astounding consequence of this culture shift was to increase procurement spend on so called ‘micro businesses’ (firms comprised of fewer than 10 people) which jumped dramatically over 5 years – providing new opportunities for nimble tech firms with a small team, laptops and huge ideas.

The Cabinet Office, through the Crown Commercial Service, achieved this by identifying barriers such as poor visibility of opportunities and burdensome pre-qualification requirements early in 2011 and launching initiatives aimed at reducing such blockers for SME firms. For example, the government abolished pre-qualification questionnaires for low-value contracts and forced all departments to use its new Contracts Finder (a portal for advertising government tenders, first launched in 2011) to raise the visibility of opportunities – along with updating firms about upcoming opportunities ahead of release.

With an extra £3bn expected to be spent on SMEs by 2020, in addition to the £12bn already spent on SME procurement every year since 2010, the market is becoming increasingly saturated with dynamic incumbents. Since 2009, GK Strategy has worked with businesses of all sizes to help them to take advantage of this widening access to procurement opportunities through our expert B2G sales support. One thing which has signalled this procurement culture change most explicitly is the active encouragement from Whitehall to small firms with an innovative and entrepreneurial zest to challenge government thinking and offer radical solutions to public sector problems.

Faced with great opportunities but increasingly ruthless competition for tenders, there has never been a better time for firms to engage in B2G sales activity to raise their profile across government departments, share knowledge to improve the Government’s processes for tendering in specific areas and navigate the myriad of rules that manage selling into government. For firms thinking of offering their solutions to government, GK has compiled some top tips for selling into government departments.

Raise your profile: The old saying is that ‘people buy from people’ – and the same is true for selling to government and the public sector. Guidance from Whitehall highlights that public sector buyers are more likely to choose a firm that they know and trust and that has a reputable profile. Though a contract will never be awarded this way, positioning yourself as a thought leader or trusted voice will play into the thinking of procurement decision makers. If they don’t know you, how can they trust you? By raising the profile of the business in government departments, you remain at the forefront of their mind when looking for solutions.

Pre-market engagement: If the first time you spot an opportunity to sell into the public sector is when the tender has formally gone to the market, it may be too late. Pre-market engagement and profile raising is therefore critical to gain an understanding of the needs and aspirations of the organisation producing the products or services. By engaging in areas where you are likely to bid for support, you will have the opportunity to provide your insight to help those seeing to draw up accurate and realistic tenders.

Offer innovative solutions: With the advent of new technologies and the potential for new and innovative solutions, there may be ways of fixing government problems they had never previously considered. By undertaking pre-market engagement and profile raising, firms can offer new solutions to old problems using evidence of where they, as an organisation, have succeeded in the past. The competitive nature of tenders also makes it all the more important for firms to differentiate themselves from industry contenders who are also likely to be going for tenders.

Look for subcontracting opportunities: Publically accessible data shows that 60% of the government’s spending with SMEs was via another, larger, contractor to SMEs in their supply chains. A large firm may win the contract, but that does not mean they will be able to deliver all aspects of it. In some instances, firms can view upcoming contracts and those that have already been awarded, which means firms can contact the main suppliers to enquire about sub-contracting opportunities. This is a valuable way for businesses to win business and build their credentials in helping to deliver public sector contracts.

Start small, go big: A small, innovative company with big aspirations – that is no bad thing. But every business needs to start somewhere, and even by using all of the tips listed above, applying for tenders over £100,000 with a minimal track record is unlikely to bear any fruit. To start with, aim for opportunities under £100,000. Building up your experience is a good first step to competing for bigger contracts in the future.

Ask for feedback: As part of their drive to encourage more SMEs to apply for public sector work, the Crown Commercial Service encourages unsuccessful firms to request feedback from the buyer on the strength of the pitch and areas for improvement. This is another excellent method of profile raising and proving to procurement managers that your organisation is serious about winning a contract.

For further information please contact….. johnny@gkstrategy.com

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