The U.S. Government is the biggest consumer in the world, spending an estimated $2.5 trillion in 2006 according to research and data company Global Insight. As such, the government provides huge opportunities for big and small businesses alike.
However, the sheer size of the government and its levels – federal, state and local — highlight the importance of developing a focused strategy of selling to the government. You need to first determine what you want to sell, and to whom. Whether you are bidding for the street cleaning contract from a local government in mid-West, offering translation services to the Department of State or selling new technology to the Department of Defense, the key challenge will learning how to negotiate with the bureaucrats in the government agencies and branches in order to advance your business interests.
The book “Seven Secrets for Negotiating with Government: How to Deal with Local, State, National, or Foreign Governments–and Come Out Ahead” by Jeswald W. Salacuse (January 12, 2008, AMACOM Books) offers some important tips when negotiating with the government:
- Small businesses need to learn and understand the numerous political and legal powers and constraints the government faces when negotiating with suppliers.
For example, the government derives its power from their monopoly position as well as their role as defenders or the public interest or welfare. The government, however, is constrained by pressures from their constituents as well as the rules they must follow in negotiations.
2. Conduct extensive pre-negotiation preparation. This step includes information gathering, preparation of strategies and planning tactics.
You need to think of the actions you need to take before actual negotiations with those you need to deal with in the government start.
3. Develop productive relationships with your counterparts in the government and supportive alliances with their constituents and others that may influence your counterparts.
4. Find the right branch, the right department and the right person that you need to deal with.
If the function is decentralized, there is no point to negotiate with government officials at the central agency. Research and analyze how the government agency is organized.
The book offers a step-by-step guide to helping you navigate through the government bureaucracy and succeed in negotiating with the government. It is an informative and easy read, and can give you the right knowledge towards winning that government contract.
For more information on how to do business with the government, check out the following government resources:
- Selling to the Government through Online Procurement Marketplaces
- How to Start a Food Business in Texas
- How to Do Business with the U.S. Federal Government: A Step-by-Step Approach
- Starting a Daycare Business in Arizona
- Advantages and Disadvantages of Various Advertising Mediums