Articles tagged with: Techniques

Small Business Scams and Pitfalls

on Friday, 07 March 2014. Posted in Techniques & Strategies

As I tell our clients, everything you do comes down to two and only two outcomes. You are either increasing revenue or you are decreasing costs. Every business function supports one or the other. I'm going to take a different approach this month. Instead of providing techniques and strategies to increase revenue, we're going to discuss a couple of ways to protect the money you're making today - or decreasing your costs.

Over the last five years, we've worked with hundreds of companies and presented sessions to thousands more. One of the advantages of working with other companies is that we get dozens of emails every week asking if this email or that email is legitimate or what I call an "unethical money grab" that you should run away from.

While there are many more, the following 8 scams or pitfalls have reared their ugly heads more often over the the last six months:

1. Paying another company to do your 8a, WOSB, SDVOSB, or GSA Schedule. On average, most companies take approximately twelve months to complete their own GSA Schedule application and this is before the current nine month certification timeline once submitted to GSA. I should note that this average is based on discussions I have personally had with several hundred companies over the last several years. There are companies, which I call "GSA Application Sweatshops" whose sole service is facilitating, consolidating, submitting, and negotiating your GSA Schedule. There is a reason these companies exist. From personal experience, half are legitimate. Half are con-artists. For full transparency, RSM Federal does perform these services but as a boutique offering when combined with other services and we outsource this to who we consider one of the most knowledgeable application firms in the country.

I've also seen an increase in companies that provide application "consulting" services where you get training and you're responsible for submitting and negotiating the application. These companies require you to fill out the application but provide you with subject matter experts who will "answer your questions and keep you on track." If you can find a reputable firm who has the necessary expertise to make your life easier, you're good to go. This is no different from companies that do the entire application for you.  Neither is better than the other. The training companies came about because they recognized that a section of their target market, small companies, didn't have the cash flow. So they train you to do it yourself and are available when you have questions. Whether you pay $2,000 for training or $6,500 to have it done for you, neither is better than the other.  It comes down to what you can afford, your current level of understanding the GSA process, and the strength of the organization supporting your schedule effort.

And that brings us to GSA Schedule application pricing. Companies charge between $1,500 and $28,000 to complete your schedule. Those that promise or guarantee expedited GSA processing will charge more. The problem is that most of these companies are lying through their teeth. There are three ways to expedite a schedule and all of them are almost impossible to attain. In my opinion, if you're going to pay for GSA Schedule application services, it should be between $4,500 and $7,500. Are there companies that can do it for less and do it well? Of course there are. But I know how extensive the application process can be and the amount of time it takes. Companies that do these applications for less than $4,500, if they spend the right amount of time and ask you the right questions, can't stay in business if they don't make any money. Then you have companies that charge more than $7,500. I know of one company in Washington DC that charges $28,000. That's just plain ridiculous. The owner told me that all he has to do is "convince four companies to pay that amount and he can vacation most of the year." Now here's the strange part - his clients get their schedules but he also tells them that he will help market their services. In other words, you're putting him on retainer for 12 months. Is he strong enough to help your company? I'm not sure - he understands the federal space but the question is whether or not he understands small business and how to help you position in the market?

Bottom line. There is no right answer and there are thousands of companies that are offereing these services. But before you decide, you have to figure out if you and your company is capable of doing it on your own with some help here and there. Final point - for a number of our clients, we don't even recommend that they get a GSA Schedule. . . really. If you have any questions on this, contact myself or a member of the team and we'll help you make the right decision.

2. Dun and Bradstreet Credibility Corporation (DBCC). Dun and Bradstreet provides a very important service. They provide you with a free DUNS number in order to register with the Government's System for Award Management and every government contract (not counting micro-threshold purchases) requires your DUNS number. But they don't harass you. But Dun and Bradstreet Credibility Corporation harasses tons of small businesses with some very unethical scare tactics. They call to tell you that several companies have accessed your profile and due to an incomplete profile you are losing business. Don't fall for it. Ever heard of rippoffreport.com? Look them up. Don't waste hundreds or thousands of dollars.

3. Small Business Teaming Services. It's funny, but I've found this is a fairly standard service offering for new startup consulting folks that target companies like yours. On the outside, it's a phenomenally strong concept that every company should be doing. For example, one of RSM Federal's core strengths is Programmatic Teaming Strategies. However, what is the value of some guy or gal connecting with you with other companies? Better question - why aren't you doing this yourself? Companies that offer you teaming services almost always offer you consulting services as the primary service. So when you get pitched this service, don't focus on "being connected to other companies" - focus on whether or not the consultant or firm is an expert in government acquisition. It's really that simple - don't pay for teaming services. Pay for expert consultation and teaming services should be a no-cost value-add service.

4. Marketing Catalogues or Books. This one is legal but highly unethical. There is a fairly large industry for these services but the market does not exist . Most companies are used to paying $500 to $3,000 for a quarter or full page advertisement in their local paper or an industry magazine. In fact, RSM Federal just spent $1,000 on such an advertisement. But there are at least a dozen companies I'm aware of that create two to three inch thick catalogues, separated by industry, with quarter and half-page ads for hundreds of companies. They distribute these to approximately 25,000 contracting officers in the Federal government. The only problem is that if contracting officers need to find a company, they do it online via existing government vendor systems. Never pay for this. Money down the drain.

5. Outsourcing Proposal Writing. I recently met a gentleman by the name of Steve Krause who is a Principal with Catalyst Partners in Washington DC. Where we both help businesses grow, we focus on different segments within the market. But we both agreed that there are two terrible decisions a business can make. One is outsourcing your sales and the other is outsourcing proposal development. First it's expensive. Second, it's learning how to think and position which provides a company with the most value. Having a copy of another company's proposal provides you with a template - but it does not help you understand how to strategically plan and design a proposal response. RSM Federal will not write another company's proposal. We've been offered a lot of money to do it and because we know it's absolutely not in the Client's best interests, we have an ethical and professional responsibility to decline. There are techniques and strategies to increase your maturity in this area but outsourcing it is not one of them.

6. Speed Dating Events. Okay, that's what I call them. DoD and various federal agencies call them by other names. It's when you sign-up for an event and you get five minutes with someone and then move to the next table for another five minutes, and you do this for an hour. If you go in with the objective to sell - don't go. If you've never been to one of these and you decide to attend without understanding how to approach these events - don't go. The majority of the folks you meet are not decision makers. The majority of companies attending are in the same boat as you so plans on meeting other companies in order to team with them is not a strong strategy. Most companies waste their time at these events - not because they can't be valuable, but because they don't understand how to approach the event. For small and large business alike, cash flow is king. Don't waste it.

7. Cold Calls. Because RSM Federal is a registered government vendor, even we get two to three calls per week. Drives us nuts. Makes me want to staple the CAN SPAM anti-spam act on their foreheads. We're all in business to make money. Some companies are very good at what they do and others are one or two folks who couldn't find a job, put up a sign on the outside of a vacant building, and told the world they're experts who can get you a $1 million contract in ninety days. When you get a cold call, you really can't tell the difference. Well. . . I can because I know the four or five questions that will immediately tell me if they are competent. But this is also what I do for a living. I'll give you the first question - "What is the URL for your website?" and you ask them to wait while you pull it up. Half the time, you'll quickly be able to identify if they know what they're doing or if they just need some quick cash (your hard-earned cash) until they can find another job. Unfortunately, these are the folks that everyone refers to when they say, "Oh, I've used consultants. . . oh yes I have. .. and I can tell you I spent money and didn't get anything for it." Ask yourself this question: "How many times have you actually paid for services from a cold-call?" Not many. If you're looking for a quality consultant, advisor, whatever term you pick to help your business grow - talk to your colleagues and friends. Get a referral. Yes, exceptions always exist but are you really willing to take that chance?

8. Gmail, Hotmail, and Yahoo Email Accounts. This primarily applies to entrepreneurs, start-ups, and young small businesses. If you're doing business under one of these email accounts, you are severely impacting your brand, your credibility, and the opportunity to make money. If you don't have a an email address where the domain is the name of your company, e.g. @rsmfederal.com, then you're not serious about your business. This is not meant to hurt anyone's feelings. Starting a company is hard and you have to prioritize all of the activities it takes to be successful. But your email domain should be a key priority. Most business owners delete these emails without reading them. Now here's the good news. If you need a professional MS Exchange email account, there are dozens of options online (including Go Daddy) where you can have email for $100 - $200 a year. While RSM Federal's website is managed by another firm, our email is through GoDaddy. Something to think about.

 

Which key ones did we miss? Let us know examples you've had to deal with. 


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Joshua P. Frank is Principal and owner of RSM Federal, a federal consulting and business-acceleration strategy firm that represents small and large businesses in accelerating the education and processes necessary to win government contracts. For more information and videos about RSM Federal, please visit www.rsmfederal.com   

Selling To The Government - What Does It Take To Be Successful?

on Tuesday, 01 October 2013. Posted in Techniques & Strategies

If you're like most business owners, you've spoken to several non-profits in your local region who are funded in order to help small businesses win government contracts, attended a handful of conferences and expos, paid to watch a couple of webinars, and purchased no less than a dozen books on selling to the government. Yet, a very large number of you have yet to crack the code on how to best position for and win government contracts or increase your government sales.

In 2012, RSM Federal started working with a new client. If you've seen been to www.rsmfederal.com, you know we require ourselves to provide name, title, and company whenever we utilize a quote or client success. But in this example, we don't want to impact their competitive advantage. So for the purpose of this article, we'll call this company Blue Strategies.

When we first started working with Blue Strategies in 2012, they were focused on commercial sales with no understanding of how to sell to the government. Via a referral, I was introduced to Blue Strategies and we immediately starting working together. During the first six months, we completed the following:

     1. Two day onsite government tailored workshop (Accelerated education of the market)
     2. Design and build of government market entry strategy
     3. Communication's strategy
     4. Website update with detailed government landing page
     5. Prospecting plan and follow-up processes
     6. CRM for pipeline management

The above activities included dozens of sub-activities but that's not the focus of today's article. What is important are the results and I want you to pay special attention to how the integration of the above activities were required to achieve success. First we'll identify the results and then we'll discuss how integration of these activities opened new doors and provided competitive advantage. The results:

     1. A two day workshop was tailored specifically to Blue Strategies, its products, and its services.

     2. Built a market penetration strategy (MPS) based on who buys their solutions, how often they buy, and how much they spend. The MPS also included a list of those companies they should consider teaming with based on the prior government contract awards. The strategy included a target list for agencies and partners; how to communicate value, differentiation, and commercial past performance; how to price proposals; how to differentiate their proposal; and other business strategies.

     3. Once the MPS was ready, we spent quite a bit of time creating a prospecting plan that focused on pre-acquisition (before RFPs or RFQs are released).

     4. Developed a new Program to communicate expertise in their market and industry that provided a solid perception of maturity, expertise, and trust.

     5. In 2013, Blue Strategies initiated capture management for government sales. In the first 6 months of their fiscal year, they exceeded their annual quota by 43%. . . and they still have six months to go.

     6. In 2013, Blue Strategies won a contract with the Department of Veterans Affairs, their largest federal contract to date.

     7. In 2013, an incumbent contractor on NASA SEWP IV, one of the largest government wide acquisition contracts (GWAC) invited Blue Strategies to join them as a subcontractor on the SEWP V opportunity, a contract vehicle with more than $5 Billion in contract opportunities.

In little more than six months after initiating the sales process, how did Blue Strategies translate activity into success? So many companies fail to connect the dots and achieve a successful government revenue stream. So how did Blue Strategies do it? The answer lies in education and how that education supported the integration of their business functions.

Unlike most companies, Blue Strategies didn't simply go to a local government non-profit to learn "how to sell" to the government and then respond to every RFP or RFQ they saw on FedBizOpps. This is the reason why so many companies fail to successfully sell to the government. It's not because most companies don't have outstanding solutions. It's because they don't understand the market and are unable to accelerate their activities with proven techniques and strategies. You can't Google this. You have to learn it. Successful companies immerse themselves in learning about the market and picking successful technique and strategies required to differentiate and communicate competitive advantage. In the case of Blue Strategies, what they learned in the workshop (the foundation for everything they learned over the subsequent six months) was integrated into every business function and then cross-mapped between business functions. Blue Strategies' value and the techniques and strategies they utilized were integrated across all public-facing tools and platforms.

Before Blue Strategies took these steps, in 2012, the president of the company set a quota of $300,000 for 2013. That was their goal and it was my responsibility to help them get there. Government was still new and they had yet to start selling to the government. Then in 2013, they initiated capture management and sales. In the first six months, they won more than $430,000 in government contracts. What's even more impressive is that the average contract award was $11,800. While many other companies sell what they sell, the approach to how they communicated differentiation and the value of their solutions was key. This value is outlined and communicated on their capability statement, on the website, in emails, on the phone, and in proposals. It came down to trust and how they communicated the value of their solutions went beyond the financial.

Three months ago, Blue Strategies was contacted by a Contracting Officer in the Midwest who required their solution at a Veterans Administration (VA) hospital. I worked with the Blue Strategies on how to position and win the opportunity. It started with asking the contracting officer how many companies he had reached out to. The answer was three. We asked if there was an incumbent. The answer was yes. We asked for the name of the incumbent. He provided it. Although the incumbent had performed outstanding work, the acquisition strategy did not allow the incumbent to compete for the follow-on contract. We called the incumbent, who was less than thrilled to hear from us. However, we spent several days developing a strategy that proved to be successful. When Blue Strategies contacted the incumbent, they provided a win-win solution that developed into a relationship of trust. Blue Strategies was willing to give up revenue that most companies would fail to consider if it guaranteed an exclusive teaming agreement with the incumbent. The incumbent agreed, the competition lost access to the incumbent, and our client won the contract. In this case, it's less about what you sell and more about how you position with the government and with your teaming partners.

Then last week something happened that became the genesis for today's article. An incumbent contractor, one of only 45 companies that competed for more than $5 Billion in contracts the last seven years, sent them an email. There was one requirement in the statement of work for the upcoming SEWP V contract competition that the incumbent could not support. They reached out to several companies, including Blue Strategies. Why did they contact our client? Because Blue Strategies' website communicated a mature understanding of the federal space. That was the start. That same day, a conference call was scheduled and the very first question Blue Strategies asked was "Are you formally asking us to be a sub-contractor on SEWP V?" Why would you spend several days collecting information and pricing if there's no guarantee the Prime will put you on the team? They said yes. Within 24 hours, the two companies signed a teaming agreement for one of the largest GWACs in the Federal space. The website and how it differentiated Blue Strategies was critical. The ability to communicate in government terms was critical. When they asked Blue Strategies if they had the capability to do the work, the answer was more than yes. . . it was "of course. . . it's very similar to the work we did for the VA last month." It's more than just what you sell. It's how you position, differentiate, and communicate the value provided to your clients. Not necessarily the value of your solutions. It's about communicating actual and perceived maturity as an organization.

There are many companies that understand the basics, attend a few government events and webinars, and still "don't know what they don't know. . ."

The most important thing you can do is educate yourself beyond the common "How to do business with the government." The basics of selling to the government are provided by several dozen organizations, many of which are free services. They all provide outstanding value and I recommend they be your starting point. But selling to the government and giving yourself a higher than average chance for success, requires more than a basic understanding. This is not unique to government sales. Education is a common business paradigm regardless of market or industry. It requires immersion and utilization of proven techniques and strategies that are integrated across business functions. It starts with the owner. It comes down to business acumen. If you become a student of government sales, you're likelihood of winning a government contract will be much higher. When you wonder how a specific company became successful. . . now you know.

Did this article pique your interest? Yes? What are your next steps? 

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Joshua P. Frank is Principal and owner of RSM Federal, a federal consulting and business-acceleration strategy firm that represents small and large businesses in accelerating the education and processes necessary to win government contracts. For more information and videos about RSM Federal, please visit www.rsmfederal.com   

Proposal Screening and Pricing

on Thursday, 11 April 2013. Posted in Teaming

Are You Talking To A Potential Competitor?

Most businesses understand the basics of being a Prime or a Subcontractor when responding to a government Request For Proposal (RFP) or Request For Quote (RFQ).  As prime, you submit the proposal and if awarded, your company receives the award.  You may have one or more companies (subcontractors) who work for you on the project.  As a subcontractor, you are a member of a team and work for the prime who is awarded the contract.  Most companies understand the basics.

Two weeks ago, I was on a conference call with a media organization that provides federal radio advertising on government radio stations.  What transpired was troubling and while it was legal, it was highly unethical. More important, the situation discussed below educated the prime on what questions you must ask other companies when you obtain pricing.

RSM Federal is on a team responding to a federal agency RFP. Because the RFP requires purchase of radio ads on specific radio stations, every company responding to the RFP had to call the radio station to get pricing. To broaden this concept, if it were a technology RFP, you might call Oracle to get pricing on a database license; or if the RFP asks for kitchen exhaust hoods in addition to cleaning services, you may provide the hoods, but you may need to subcontract to a cleaning company and obtain pricing for their cleaning detergents.  In this case, it's obtaining pricing for on-air time slots.  Our team is a strategic marketing  and advertising team - not a radio station. Every company that wants to respond to the RFP has to call the station for pricing.

This led to a conference call. Throughout the call, the employee for the radio station was answering questions but didn't seem to be providing complete answers. It felt as if she were holding back information. So I asked the following questions:

  1. Are you providing the same pricing to every company that calls you and if not, how do we obtain preferred pricing?
  2. Are you, as a radio station planning to subcontract or prime this opportunity?
  3. If you are planning to prime, is our team obtaining the same or better pricing?
  4. If you are planning to prime, are you running a screen?

She would not confirm that they were providing the same pricing to all companies or if there was preferred pricing. When asked directly, she confirmed that the radio station was in fact planning to respond to the RFP as a prime.  Finally, she would not verify if the pricing given to our team was competitive (the same) as what the radio station was going to quote themselves. In other words, the radio station was providing pricing to various teams but it was likely that the pricing in their own proposal would be less expensive than what they were giving to us. Furthermore, now that we knew they were responding to the proposal AND providing pricing to other teams, we asked if they were running a screen.  They refused to answer the question.

What is a screen? When a company plans on responding to an RFP as the prime (submitting a proposal directly to the government) and as a subcontractor (supporting pricing, requirements, manpower, etc.) to another company, ethics require that the company employ a screen. In the case of this radio station, they should have two teams that do NOT communicate between themselves on the specifics of the RFP. This ensures that the services being provided and the costs of those services are not being communicated between the internal teams.  Again, not illegal - but full of unethical possibilities.  Here's what can happen: Let's assume you are the prime and you ask for pricing on a ten second radio slot and get $85.  Now you have to add a margin so let's assume your bid to the government is $90. Without a screen, the radio station that just gave you a price of $85 recognizes that you are going to add a margin.  Then they bid $75 directly to the government.  You're at $90 and they are at $75. This is legal.  But it's highly unethical and this situation can be prevented by asking the questions above before pricing is discussed.

And here is what we left out - during the call, our team discussed proposal strategy, assuming that the radio station was not a prime. The alarm bells didn't start going off until after we had discussed our strategy. So we had given another company, our competition, a competitive advantage without realizing it. The team had assumed that since the opportunity was a 100% small business set-aside, that the radio station would not desire and could not respond as a prime.  Bad assumption.

While not legally a subcontractor, by obtaining pricing from the radio station, they are a de-facto subcontractor because those parts of the RFP are being subcontracted to another company. . . the radio station. There are no none disclosures or teaming agreements - just pricing.

Our team identified ways to compensate for this and updated our pricing accordingly.  We're currently in source selection.  Whether our team wins or loses, we'll provide an update to this article.

Every government acquisition is different.  For many companies, responding to an RFP may not require products, services, and pricing from another company. This situation is a bit more unusual because the government specifically identified a radio station by name in the RFP. We had to get pricing from them.

To recap the lessons learned: If you have to get pricing for products or services from another company, before you discuss the opportunity, you must first verify their intent. Are they providing pricing to other teams? Are they a sub-contractor on another team? Are they intending to prime? Also, depending on the answers, are they running a screen? This provides your company or team with confidence that all parties are being ethical.  Regardless of running a screen, are they being consistent with their pricing and if not, to what extent? In certain situations, you may decide not to bid because it may be too difficult to achieve competitive pricing.

RSM Federal specializes in these and other small business government teaming and sales strategies.  For more information, please visit www.rsmfederal.com or call us at (703) 677-1700.

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Joshua P. Frank is Principal and owner of RSM Federal, a federal consulting and business-acceleration strategy firm that represents small and large businesses in accelerating the education and processes necessary to win government contracts. For more information and videos about RSM Federal, please visit www.rsmfederal.com 

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