Deltek Sr. Analyst Chris Cotner reports.
This is part two of a two-part series on INPUT’s 10-year state budget projections.
As mentioned in part one of this series, the news regarding state financials has not been positive for a while. FY 2012 is looking like one of the worst (in terms of a decrease in overall state budgets) in history. However, things are looking up as business opportunities exist now and are projected to increase looking at FY 2013 – 2015. For businesses interested in capitalizing on this business intelligence, here are 6 simple strategies to survive doing business with the states during these economically hard times. For a complete recap of the data used as a basis for this article, read part one (it’s free).
1.Save the date: Circle the wagons; circle the date; save the date; do whatever it takes to make it through FY 2012; weather slower growth in FY 2013; and capitalize on more normalized growth in FY 2014 and 2015.
2.Hunker down: Even during difficult recessionary times, states still do business procuring goods and services. If your company has an interest in doing business with a particular state, hunker down and wait out the storm. If you have existing contracts, you may need to focus on service and existing contracts to help make it through the hard times. By FY 2013, things should be improving slightly. By FY 2014, most state business should be back on track. State economies should be chugging along at pre-recession growth levels by FY 2015.
3.Let the wind take the chaff: Weaker companies will not be able to weather this storm by waiting for state purchasing to pick back up in the next few years. If your company has interest in doing business with a state, weathering the storm will ultimately prove fruitful. As weaker companies fall aside, when procurement and opportunities pick back up, you should be well-positioned in a market with fewer competing companies. In the meantime, continue to let officials know your company is stable and ready for business when opportunities arise.
4.Talk to decision-makers to create the want: Through my 13 years working in state government, I’ve learned a few things. Most companies believe that unless there is an RFP, and money is specifically allocated in a budget, then procurement will not happen. This is similar logic used by some in their job searches; if a position is not advertised, there must not be any openings. Sure, sometimes it works that way. However, in state government, if a decision-maker becomes interested enough in a business solution or product, the funds can suddenly become available as long as the purchase is below the threshold for legislative or cabinet-level approval. Things are moved around in the budget for items decision-makers want. Simply, find those decision-makers and make your pitch. If enough desire is created, your solution should at least be on the table for further discussion, worst case. Who knows, you may just secure a surprise and lucrative contract.
For the complete blog, go here.
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