Federal Sales and The Short Life of Online Sales Leads

Harvard Business Review has a very important piece on how quickly on-line sales leads expire.

They studied 2,241 U.S. companies and found that "37% responded to their lead within an hour, and 16% responded within one to 24 hours, 24% took more than 24 hours—and 23% of the companies never responded at all."

A more important study found that companies responding to an on-line lead "within an hour of receiving a query were nearly seven times as likely to qualify the lead...as those that tried to contact the customer even an hour later—and more than 60 times as likely as companies that waited 24 hours or longer."

If you're not responding to a lead within an hour of receiving it on your website, your chance of turning that lead into a prospect nearly evaporates.

Many companies send government leads to the federal sales team rather than a commercial rep. If the federal rep cannot respond immediately, the sale may be lost forever.

The authors found that reasons for delay "include the practice of retrieving leads from CRM systems’ databases daily rather than continuously; sales forces focused on generating their own leads...and rules for distributing sales leads among agents..."

To combat this, your organization should:
1. audit your on-line lead generation system,
2. identify bottlenecks that delay the distribution of federal leads, and
3. re-design the system to allow someone within your company to always respond within an hour.

Allow your commercial sales rep to have the initial dialogue with the federal employee making the query, then hand the lead over to a federal sales rep.

Better still, create a separate portal on your site for government inquiries, so they get e-mailed directly to the federal sales team without being entered into the main query tracking system.

The bottom line: if you don't respond to government queries within an hour, your chance of turning that query into a sale plummets drastically.

What Are GSA Schedules Really Good For?

GSA Schedule contracts are complex creatures. Books that run over 500 pages have been written about them. However, the basic question that companies always want answered is simple. What are GSA Schedules really good for?

The answer is also simple. They streamline the procurement process and minimize your competition.

GSA Schedules streamline the procurement process by reducing the number of steps a Contracting Officer must perform before awarding a purchase order. They allow the government to operate faster and under less burdensome procurement regulations, reducing the cycle time of a purchase.

GSA Schedules minimize your competition by limiting the procurement process to only those companies that also have similar GSA Schedules. It simply eliminates all competitors that do not have a GSA Schedule of their own.

No one should minimize the complexity of the GSA Schedule program. However, it is also important to maintain a focus on the big picture and remember that GSA Schedules, as much effort as they require, offer you unique opportunities to sell more, sell faster, and drastically reduce your competition.

You can learn more about these advantages at the Rozycki Associates, LLC Frequently Asked Questions page.

SBA Dynamic Small Business Search

If your small business has registered in the federal government’s Central Contractor Registration (CCR) database but has not completed your profile at the SBA’s DSBS site, you’re missing a great opportunity.

If you're in CR, go one step further and enter detailed capabilities information in their Dynamic Small Business Search (DSBS) database.

DSBS is a searchable master database of all the small businesses in CCR, yet only a fraction of companies provide any meaningful content.

I have been told by federal Contracting Officers that they routinely use DSBS to search for companies with specific capabilities, and that without a blurb describing your business they most likely won't take the time to even click on your DSBS listing.

As you complete your CCR filing, you’ll be prompted to complete the DSBS data if you are classified as a small business. Take the few minutes needed to provide some descriptive information and develop yet another tool for reaching out to federal buyers.

Something this quick and easy should be done by every small business in the federal market.

At Rozycki Associates, LLC, we help both large and small businesses succeed in the federal sales environment.

All Federal Sales Are Scalable

I recently discussed the issue of scalability with a contact who is considering entering the federal market, but is unsure if he can leverage his efforts enough to make a major impact. He's concerned that the federal market is too dispersed and diverse to be able to build on past sales to create a sustainable advantage.

The reality is that all federal sales strategies can be scalable due to the government’s strong reliance on past performance when selecting contractors. Contractors with past performance are simply more likely to receive contract awards. The good thing about this, of course, is that as soon as you have your first sale, you have past performance.

Many contractors fail to articulate their past performance in a way that allows it to be used in the government’s best value determination.

You absolutely must provide buyers with information about your federal past performance either through either your website, product literature, e-mails or conversations.

As long as federal contracts incorporate past performance as one of the award criteria, you can leverage that to make your federal sales program a truly scalable effort.

At Rozycki Associates, we can help you ensure that your federal past performance gets communicated to your customers in the best possible way.

Competition and New Entrants to the Federal Market in a Recessionary Environment

As the U.S. economy continues to be roiled by cutbacks in both consumer and corporate spending, I’m seeing an increased number of companies turning to the federal government market.

Entering the federal market in difficult economic times is nothing new. A similar wave of newcomers arrived in the aftermath of the 2001 dot-com crash. Some of these companies went on to become successful contractors, while others floundered for a few years before returning to their roots in the commercial marketplace.

Both new entrants to the market and established contractors need to be aware of the impact of these changes to the competitive landscape.

If you’re a new entrant to the market, you’ll quickly find that the competition in your strategic group may be completely different than you’re used to. In the federal market, you will encounter rivals you've never before heard of, and your biggest competitors may be nowhere in sight.

Established contractors also need to be aware of the quickly changing competitive landscape. New firms may enter the federal market with blazing speed, and they have the potential to disrupt established relationships with your customers. They may literally be fighting for their corporate lives, and may aggressively price their products or services to establish a presence in this new market.

While not every company in the federal market has a GSA Schedule, they are the contract vehicles toward which commercial companies tend to first gravitate, and GSA Schedule activity often provides the first indications of a company’s actions in the federal market. Therefore, the best places to monitor the changing composition of your strategic group remain GSA Advantage and the GSA Schedules E-Library.

Please contact us at Rozycki Associates to learn more about our competitive intelligence services.

“I got a ‘rated’ purchase order under my GSA Schedule? What does that mean?”

A client recently asked what it meant when a military Contracting Officer issued them a high-priority “rated” purchase order. Although the company had held a GSA Schedule for years, they had never seen a rated order, and weren’t sure what their obligations were.

GSA Schedule holders may receive orders that require the contractor to give preferential treatment to that order under a set of procedures called the Defense Priority and Allocations System (DPAS).

These orders can be rated either “DX” or “DO”, and these classifications establish the priority level of the order. DO rated orders take preference over non-rated (commercial) orders. DX rated orders take preference over DO rated orders and non-rated (commercial) orders. Each rated order must also contain a required delivery date.

Your obligation under a rated order is usually simple: you must modify your production or delivery schedules to ensure that rated orders are delivered by the required date, prioritizing them over non-rated (commercial) orders or lower rated orders, even if this means disrupting or delaying orders to other customers.

Under the DPAS system, you may also flow these ratings down to your suppliers, requiring them to modify their production and delivery schedules to ensure that you receive your component or raw materials at a higher priority than other customers.

There are some complex situations that arise regarding rated orders. For example, if you receive 2 rated orders simultaneously, you may need to determine the correct way to prioritize one over the other. You may also receive an order that combines rated and non-rated products.

You may even receive an improperly rated order – an order from an agency which is not authorized to place a rated order or for products which by law cannot be placed on a rated order.

In order to resolve these situations, you may need to seek guidance from the original Defense Production Act of 1950, or in more recent implementing regulations such as the FAR and DFARS.

While not a common occurrence, understanding the basics of DPAS priority rated orders will allow you fulfill them as quickly as possible with minimal disruption to your commercial customers.

Who’s Selling Your Products on GSA Advantage? You’d Better Keep Tabs…

A client of mine recently faced a problem. A company had added my client’s products to its GSA Schedule contract and put them up on GSA Advantage, GSA’s e-commerce site.

However, not only did this company not get my client’s permission to do so, my client had never even heard of this company!

One initial reaction might be, "So what? This just provides more feet on the street and more possible sales through the channel." Unfortunately, it is not that simple.

A Group 70 IT GSA Schedule contractor that acts as a dealer needs to obtain a "Letter of Supply" from the manufacturer. This letter guarantees a source of supply and, among other things, provides certifications about the country of origin, Trade Agreements Act, etc.

Somehow, this "rogue reseller" was able to add my client’s products to a GSA Schedule without this letter, most likely due to lax oversight by the GSA Contracting Officer.

From my client’s perspective, this was a very bad situation. The reseller had never been trained on the products, had no ability to provide pre-sale technical support, and did not have any access to warranty and repair services. If a sale by this "rogue reseller" went sour, my client's brand name would be unfairly tarnished.

The reseller was even listing products my client no longer manufactured! If the reseller received an order for these products, there was no way it could be fulfilled.

My client realized the damage that could be done, and sent the unauthorized reseller a certified letter demanding the immediate removal of the products. The reseller complied, and the problem was fixed…for now.

However, I’m beginning to see this as a persistent problem.

Manufacturers must monitor GSA Advantage and look for unauthorized resellers if they want to maintain control of their federal sales channel, maintain pricing integrity and minimize the risk to their brand equity.

Take a few minutes and check GSA Advantage. You might be shocked at what you see.