Article by Lyndon Dacuan of Onvia:
Beginning of the Fiscal Year – Offer a Helpful Hand
At the beginning of any fiscal year, agency contacts are well into the project planning and execution stages for the new fiscal year. Budgets have been finalized and the real work begins – turning high-level budget line items into actionable bids and RFPs with requirements spelled out and specifications exacted. During this period of time, agencies are seeking experts to help them craft their RFPs with the best practices in the industry; this presents a ripe opportunity for vendors to engage and consult with their targeted agencies. Government vendors who offer a helpful hand to agencies can keep their companies fresh on the minds of those agency decision makers when the RFP is published, positioning themselves for a greater chance of being awarded those contracts.
Middle of the Fiscal Year – Work to Diversify and Track Spending
Track your target agency’s spending to keep an eye on the agency’s remaining budget. Review the agency’s current fiscal year budget throughout the fiscal year and compare it to actual spending. By leveraging the full lifecycle of contract intelligence in the public sector from budget to advance notice to RFP to award, you can assemble your own estimate of the remaining budget near the end of the fiscal year. If a target agency budgeted for a major purchase during the year but you haven’t seen it come up for bid yet, use your agency connections to find out if those funds were repurposed for another use or if they are still projected to be spent in the current cycle.
End of the Fiscal Year – Secure Future Budget
For most government agencies, when a budget is not fully utilized by the end of the fiscal year it runs a risk of not being renewed for the upcoming year. Agency decision makers who don’t want to lose their expiring budget will feel compelled to spend their remaining funds at the last minute to secure the same budget for the next year. This is a well-studied phenomenon in government spending with a Harvard study from 2010 finding that, at the federal level, 16.5% of government spending occurs in the last month of the fiscal year — more than double what you would expect if spending were spread evenly across all months. Government vendors should be aware of this reality and adjust their government sales strategy to account for it. Reaching out to agency contacts in the last quarter of the fiscal year and using any budget tracking intelligence you’ve collected throughout the year could reveal last-minute business opportunities and spur a constructive discussion as the year comes to a close. Also consider re-connecting with any teaming partners you have worked with throughout the year to find out if their government clients are considering any last minute purchases related to your area of expertise.
Why Fiscal Year End Dates Matter
The most successful government contractors know that the end of the federal fiscal year does not spell an end to their government business for that year, but it can have unintended consequences on procurement activity if there are hiccups in the broader economy or if a vendor is overly reliant on a group of agencies that share the same fiscal calendar. While it is important to develop and nurture relationships with federal agencies around the federal fiscal year-end in September, opportunities to influence your state, local and education market (or SLED) government business occur throughout the calendar year due to the diversity of SLED agency fiscal years.
For more on the diversity of SLED agency fiscal year end dates, check out our deep dive analysis of state, local and education agency fiscal year schedules.
Author: Lyndon Dacuan
Lyndon is a Content Marketer for Onvia (NASDAQ: ONVI), which has been delivering the data, business intelligence, analytics and tools that help their clients succeed in the government market.