What is it

Richard White's second book "Cracking the $500 Billion Federal Market" examines the challenges faced by small businesses hoping to break into the federal market.

Cracking the $500 Billion Federal Market - Chapter Excerpts

The introductory paragraphs from the first ten chapters of the book are presented below.

Chapter 1

The Best Offense is a Good Defense

The federal market is growing so fast that it's virtually impossible to determine its size. Experts theorize that the federal government spends between $450 billion and $500 billion annually. The market is unlikely to slow down when one considers the monies spent to combat terrorism, to fund the Iraq war, and to finance the recovery efforts needed after recent natural disasters.

Chapter 2

Make the World's Biggest Customer Your Own

As discussed previously, the federal government spends approximately $500 billion on an annual basis. Half of all federal contracts are awarded through limited competitions or sole-source awards. By any measure, the federal government is the world's biggest and most lucrative customer. Study the federal market and then go after the business in the same way as you do in your current market. If your company qualifies for a small business preference program, it can quickly become a $100 million company if it learns to play the federal game.

Chapter 3

Market Research in the Federal Sector

The size of the federal market is not a particularly meaningful number if only a tiny slice of the market is really available to your company. A janitorial services company in the Chicago area has a limited geographic area in which it can realistically deliver its services. The key questions for this type of company are whether there are federal offices or installations in their locale and do these entities need their services. Once that question is addressed, the next question becomes "How much of the available work is currently held by incumbent contractors and how much of it is new work?" By doing research, your company should be able to target the sources and amount of work available to local vendors. Once the analysis is complete, your business should have a list of federal customers it wants to pursue.

Chapter 4

Become an Insider in the Federal Market

Consider becoming an insider and share in the fruits of the world's largest market. Remember, the insiders were on the outside looking in at one point in time and the game is not that tough to play once you understand it. In order to become an insider, you must first understand how competition (or the lack of it) influences how buys are made. Furthermore, your company must hold a direct contract with a federal customer. It only takes one. Having an existing federal contract allows your business to demonstrate, through your partnership with the government, that your product or service provides value to the federal buyer or end user. This partnership becomes the path of least resistance. It is the path that minimizes the federal buyer's risk and the path that allows buyers to obtain what they want quickly and efficiently. As in the commercial market, federal buyers go with the proven vendor. Think about it. You do the same thing when purchasing goods or services.

Chapter 5

Competition and Price Sensitivity in the Federal Market

It is a fallacy that federal purchases are made only after full and open competition takes place. Competition may or may not occur but, when it does, it is usually limited. In most instances, a company is not going to win a federal bid opportunity it stumbled onto online. The truth is that your competitors met with the federal buyers long before the opportunity was publicly announced and the federal buyer already has one or more companies in mind. Federal bureaucrats do not like to admit this reality because they are tasked with the responsibility of getting the best value for the American taxpayer. The reality is that federal purchasing rules not only allow federal buyers to meet with vendors prior to the announcement of a public bid but the rules actually encourage it. How else would a federal buyer assess the value of proffered products and services?

Chapter 6

Are Federal Bids Wired?

Many members of the American public believe that federal bids are "wired," implying that the bid is set up or rigged to favor a particular company. Although public bids are not wired in the truest sense of the word, the reality is that decision makers may favor the incumbent contractor or one or more companies that have done the following:

Chapter 7

Fundamentals of Federal Contracting

Many people lose sight of the fact that doing business with the federal government is done according to a contract. A federal contract is nothing more than an agreement between your company and the federal government under which your business agrees to provide a product or service in accordance with the terms of the document. The contract dictates the parameters of the deal and is the underlying basis for your relationship with the customer. Federal contracts contain countless pages of boilerplate language and convoluted clauses. Don't let the terms of the contract scare you- the contract is only onerous on the surface. Pick out the wheat from the chaff and perform as you would with your commercial customers. Go to the contract when issues arise and let the contract dictate how disputes are resolved or an issue should be addressed.

Chapter 8

Making a Federal Sale

Contrary to popular belief, people buy in the federal market, not agencies. The best way to make a federal sale is to contact a buyer through a direct sales call. Making direct sales in the federal market can be challenging but the truth is that such sales calls are difficult in any market. The federal dollars are there to be made if you make a determination to go after them. Don't let your inexperience in the market deter you from going forward.

Chapter 9

Closing a Federal Sale

Closing a sale means getting the order, winning the contract, or collecting the money (as in the case of a credit card purchase). Closing a federal sale is where the rubber hits the road; how it’s done is the fundamental difference between the federal and commercial markets. Experienced federal contractors know how to close their sales. They also know the "closing rules" and the rules are not that puzzling once you boil them down to their bare essence. Outsiders mistakenly believe that federal agencies have to open an opportunity to all who want to bid. As previously discussed, this is a fallacy.

Chapter 10

Start with the Credit Card and Quick Buy Markets for Smaller Transactions

The uninitiated do not realize how easy it is to do business in the under-$100,000 segment of the federal market. Federal purchases of less than $100,000 are theoretically set aside for small businesses (although there is a current dispute between the Small Business Administration and GSA regarding whether this is indeed true). Think about it. Many small businesses across the country would not consider a $99,000 sale insignificant.

Cracking the $500 Billion Federal Market

select your desired product
Cracking the $500 Billion Federal Market - PDF Version. Available for immediate download$25