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Are you considering selling, or do you already sell, to a city, county or state? Are you eyeing that RFP from the GSA? Consider the following as you allocate your selling resources when selling to the public sector.

Everyone competes, or so it seems, for public sector business, which is part of the problem. Just like with very large corporations (i.e., the Fortune 500 and their ilk), public sector entities can require an inordinate amount of selling effort, are slow to pay their bills (ironically with your tax dollars in this case) and require you to sell at very low margins. They are normally worse in these areas than the private sector. If there is ever a time that you need to evaluate the return on your selling effort, it is when selling to the public sector. Put caps on the sales effort you are willing to make and the minimum margins that are acceptable. Build in a “stop loss.”

Have you ever played a game with someone and realized later that your opponent was playing with a different set of rules than you? No wonder you lost. That’s the case when selling to the public sector. Your company has to find customers, keep expenses under control and generate profit. The public sector has no real customers in the traditional sense; tax dollars are allocated to them and they don’t have to show a profit. You are playing a different game here; the motivation of public sector employees can be different than what you might be expecting. For this reason the selling principles that work in the private sector don’t necessarily translate to the public sector. Your everyday “off the shelf” game plan probably won’t work.

Government RFP’s can be interesting, but in most cases you’ll want to avoid their siren song. Unless you have an inside line you stand an almost certain chance of being the “designated loser” before the RFP is even issued. For all the fanfare about vendor objectivity in the public sector, there isn’t any. Give up that dream; move on with your life. Buy a lottery ticket instead. Use your selling time more productively somewhere else, like the private sector.

The public sector frequently buys outside of formal agreements and contracts, despite what their buyers may tell you. I’ve seen too many times where something was needed in a hurry and they bought within hours with no bidding. Witness the repair of the Pentagon after 9/11. There was no formal and tedious RFP process and it got rebuilt, quickly.

The public sector can be a challenge to sell profitably. Before you embark on the odyssey of selling to the public sector be sure to carefully and realistically weigh the costs and benefits. In many, if not most, cases your selling efforts are better spent elsewhere in my opinion.

Tags: public

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