Government procurement, also known as government purchasing, is the procurement of goods and services by government agencies. In the procurement process, acquisition personnel determine their agency’s requirements and post a solicitation on the Federal Business Opportunities (FedBizOpps) website. Interested companies prepare their offers in response to the solicitation, and, in accordance with applicable provisions of the Federal Acquisition Regulation (FAR), agency personnel evaluate the offers.
Combined, U.S. government agencies represent the largest customer in the world. The Federal government spends over $4 trillion per year, while State & Local agencies spend over $3 trillion. Government spending is the largest industry in the United States, representing over 13% of U.S. GDP.
For companies who are unfamiliar with the government procurement process, selling to the government can seem daunting. “Too much red tape, the process is too confusing, it takes too long to win government business” are some common thoughts, and it is many times thought of as being a market that is just not worth the perceived headache.
Here are some of the most commonly-held misconceptions about the government LMS procurement process that have refrained companies from pursuing any opportunities with the government:
Myth #1—it always comes down to pricing and the cheapest option always wins
Whether your company is new to government sales or only has limited experience working with a few agencies, there is a common misconception that “it might not be worth the effort because government agencies are just looking for the cheapest option”. This is false. While procurement personnel always want to stay within budget, there are several more important factors they consider when evaluating their options. When procuring an LMS, most LMS vendors will be around the same price, but there are also hidden long term costs. While some LMS vendors claim to be cheaper up front in the cost for user licenses, there are also other fees such as the cost of implementation and other integrations. An LMS deployed as a cloud solution may be cheaper, but it may not not have the functionality or flexibility your organization needs. This can force agencies to acquire other products to fill the gaps the current LMS can’t provide.
The federal government, as well as state and local agencies, have the right to award government contracts to whichever candidate they feel is best suited, regardless of the actual bid amount. It is imperative for organizations to be competitive but confident in their company’s ability to provide quality goods or services and have a very good chance of winning.
Myth #2—Contracts always go to the same suppliers
Government agencies doesn’t know who is out there in the industry unless companies market themselves to the government. Whilst an existing provider could have a good chance of retaining their contract, contracts are not always award to existing contractors. Some learning technologies may have worked in the past, but may not work for future endeavors the agency may be seeking. Sometimes agencies may be forced to restructure their organization and workforce leaving their current employee development tools out of step with their future goals.
A significant factor of being successful in winning government opportunities is having a good understanding of how the overall procurement process works for your target agencies. Every agency and state can have different rules/guidelines for their procurement processes and hiring someone familiar with these rules/guidelines is important.
At Meridian, we have a team with a deep understanding of the federal procurement process and our diverse portfolio of Federal, State and Local procurement vehicles which make it easy to work with us. We know the purchase of solutions and services on behalf of an agency can be time consuming and we are equipped to guide you through this complex process.
Myth #3—It takes too long to migrate to a new LMS
When federal agencies, as well as state and local, begin their search for new products/services, they are looking for the “best overall value” solution. Some of the variables procurement departments focus on include, which solution will work for their agencies’ needs long-term, require the least amount of maintenance/support costs and overall best support the agency’s needs.
Before switching to any new LMS it’s very important to understand the reason for the switch. Agencies should define the problem areas of their current solution, map out their needs and objectives and communicate their expectations to the vendor. Once the problems and expectations from the new LMS have been specified, the vendor will do a feasibility check to identify any challenges that might arise during the implementation of the new LMS. This is key as it allows the customer and vendor to be prepare for any unexpected delays in the data migration.
It is crucial to ensure there is no data loss during the data migration process. The key goal is to migrate existing legacy data about users, courses, SCORM packages and assignments in an easy and secure way. At Meridian, we have a SCORM authoring eLearning system included with our LMS at no additional charge for qualifying new clients. This integration allows for your content authors to work collaborate to rapidly create engaging learning content and allows for an easy transfer of your content.
Myth #4—Your organization needs to be on GSA or State contract to win government business
The General Services Administration (GSA) creates a series of contracts/schedules with specific products/services offered by companies at predetermined prices. The items on GSA contract/schedule are normally commodities that are purchased in high volume by government agencies. The success of the GSA contract process prompted many states to also create contracts/schedules structured in a similar manner to the GSA, but typically with products/services that are unique to the specific state.
Many organizations are hesitant to go after government business opportunities because of the misconception that they must be on the GSA or State contract in order to win a government contract or that government agencies solely purchase from a GSA or State contract. This is not true, there is no requirement for a company to be on GSA or State contract in order to win government business.
However, if a company has a list of their products/services on the GSA and/or a State contract, this can reduce the length of the acquisition process. Meridian is currently on the GSA 70 schedule.
While selling to the government, just like any business endeavor, may not be for everyone, it is certainly a market to consider if you want to diversify your revenue stream. As the largest industry in the United States, there are ample opportunities for companies to win government business. Don’t let these commonly-held myths stop you from aggressively pursuing government sales.
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