This second in my series on comparing federal contracting with shrimping  addresses the market.  Part 1, which I published last week, provided some background and discussed three important concepts: #1) be where your customer is so they can get to know you and you can get to know them; #2) don’t rely on “conventional wisdom” – the Federal market is changing and the old ways will not work in the future; and #3) be aware that the Federal Government is not homogenous – you need to understand the mission and practices of your target market.  While these three concepts are probably true with any market, they are especially true in the Federal market. Media and hype drive a lot of our beliefs. It would be great if there were some “get rich quick” scheme, but, just like the real world, it takes planning and plain old sweat to build your business. The great news is that anyone can do it IF you have something to offer.

In this installment, we will examine some of the characteristics of the Federal market. This brings me to the next three insight I gained while shrimping in Florida:

#4. There are may ways to catch shrimp … casting, dipping, and frame nets – a combination works best. Casting involves throwing a net that sinks to the bottom and gathers up everything in its way. Dipping requires the human in the process to watch for the shrimp and literally dip the net in the water to catch them. A frame net is set behind the boat to catch any shrimp that might be pushed in by the current (similar to trawling, but without the motion). Each works in the right situation, but successful shimpers rely on a combination of methods. We used dipping and frame nets. Our haul, as meager as it was, was split pretty evenly between the two types of nets. How does this apply to Federal contracting? Well, you have to employ multiple techniques to catching your share of contracts. Some of these are GSA Schedules, Government Wide Acquisition Contracts (GWAC), Multiple Award Contracts (MACs), competitive bids, limited competitions, set-asides, etc. You also need to determine the best mix of prime and subcontractor based on your product and market. Just like shrimping, the best methods will depend on a combination of your skills and your customer’s preferences. In today’s environment, many agencies prefer to issue task orders under existing contracts (as opposed to conducting an open procurement). This means you need to have access to the contracting vehicles that the agency wants to use. If you are not a prime contractor holding one of these contracts, you will need to operate as a subcontractor to a prime. As you prepare for the Federal market, analyze your potential customers to see  how they do business. You can easily check historical patterns, but you also need to look towards the future. Discussions with the contracts and small business offices will give you a good idea how to best farm that agency. You also need to look at your existing capabilities. Do you currently hold a prime contract you could use? Is your GSA Schedule up to date? Do you qualify for any set-aside programs? But, in the end, it will be a combination of approaches that makes you successful.

#5. There are large shrimp, but they are outnumbered by the small ones. After all, that is why they call them shrimp. Yes, we all hear about the 18″ shrimp, but, in reality, the vast bulk are about an inch long. How do you figure the big ones got to ge so big? Likewise with Government contracts. Yes, everyone wants to win the “big one”. That is unrealistic and, in the end, can be detrimental to the company’s growth. There are many more small contracts that require less energy to bid, are more compatible with your company goals, and can be grown into the “big one”. Look for these gems. You need to stay out of the feeding frenzy so you can become the big one in your field. I worked for a company where we won one large contract (nearly $1 billion) and a smaller contract ($10 million) at the same time. Of course, everyone was ecstatic about the large one, but, fifteen years later, the small one has grown to nearly $50 million in annual revenue, whereas the large one ended five years after it began and was only worth about $250 million in the end. I am not saying do not go after the “big one” when it comes your way, but build you strategy around the smaller contracts. Not only will you find them easier to manage and perform, but they will consume fewer resources to win, take less time for award, and grow into “big ones” if you nurture them.

#6. Anyone can do it, but some expert guidance is helpful. No special boat is required to shrimp for fun and pleasure – just about any stable platform will work. Equipment is not expensive – nets run about $50 and lights around $75-200. But getting help from experts will improve your catch. The good news is that there are plenty of folks willing to help. The bad news is that most of them do not provide accurate and actionable information. Doesn’t this sound familiar? How many people want to help you with your business growth? Some for money, some for free. But, how many of them provide information that is relevant to your organization? There is not cookie cutter standard process that works for all companies. I have developed a “personality theory” that says every individual, organization, and project has a unique personality. You must understand that personality and use it to your advantage. Be wary of experts who brag about who they know and how they can “walk the halls”. Ask them how this will translate into business for you. Big fees do not translate to big business – especially when the experts sell that information to all buyers. Look for persons and organizations who are willing to work with your unique personality. If they are not willing to spend the time to get to know your organization, then they will not be able to help you. Keep in mind the old parable (reworded a bit): “You can give a man a shrimp and he eats for a day, but if you teach him how to shrimp correctly, he will eat forever“.

Take the time to analyze your target market. Speak with Contracting Officers and Small Business representatives to learn how your potential client issues contracts. Focus on opportunities that not only fit your solution, but are of a size and scope you can handle – bad past performance is a killer in this market. And seek help, but be careful of the shrimp oil salesmen – find true partners.

In the next installment, we will discuss setting up the correct organization, finding opportunities, and positioning for the kill.