3 ways to capitalize on government contracts

By Ben VaughtJuly 20, 2021

Ben Vaught is the CEO of DemandStar, an online procurement marketplace connecting government agencies with quality suppliers

After a lengthy bout of political back-and-forth, President Joe Biden’s massive infrastructure proposal – the American Jobs Plan – is beginning to take shape. Last month, the president and centrist senators reached a bipartisan agreement on the bill’s framework, which proposes $1.2 trillion to repair, replace and rebuild America’s crumbling infrastructure.

In many categories, the bill as proposed would be the largest infrastructure investment in U.S. history. Structured to use infrastructure as a way to put jobs into the hands of American families, the bill will create a flood of contracts for essential work and create jobs for communities in every corner of the nation.

Last month’s agreement was a big step for the bill, but much discussion and debate remain before Biden puts pen to paper. In the meantime, government suppliers would be wise to arm themselves with knowledge of the bill – what it will do, what it means for them, and how they can successfully seize on the myriad opportunities it will present.

This is an opportunity unlike anything most contractors alive today have ever seen, and they should treat it as such. If they haven’t already, now is the time to start thinking about doing business with public sector agencies that will gain enormous spending power as funds trickle down from the federal government to state, county and local organizations.

A flood of dollars

Though the bill has been cut significantly from its original proposal, it still stands to create a torrent of funding that will flow through government agencies of all sizes, granting capital for roads, bridges, water systems, weatherproofing, power grids and many other projects.

Some highlights of the bill’s allocations include:

  • $109 billion for roads and bridges
  • $66 billion for railways
  • $49 billion for public transportation
  • $25 billion for airports
  • $73 billion for power grids
  • $65 billion for broadband

Compared to the 2009 American Recovery and Reinvestment Act, the American Jobs Plan puts much less emphasis on “shovel-ready projects” designed to get people back to work as quickly as possible. The economic situation in 2009 was dire, with an unemployment rate that had held above 8% for 40 months. There wasn’t time to look to the future; the economy had to be stabilized immediately. As a result of these rapidly deployed projects, bridges that were structurally deficient had to settle with having potholes filled and receiving a fresh coat of paint.

By contrast, the American Jobs Plan emphasizes rebuilding rather than repairing, creating much richer, deeper projects and, consequently, many more jobs.

Most of this work will be done in rural, small and mid-sized communities. These smaller villages, towns, and cities have always hungered to make their communities more vibrant, but simply don’t have the same tax revenue as more populated areas. As a result, their infrastructure is the most in need of support.

The American Jobs Plan will filter and funnel funds into these communities, creating a flow of resources for much-needed work.

How businesses can prepare

To give an idea of the scale of the $1.2 trillion being proposed by this bill, consider this: It’s estimated that the federal reserve currently has $2.1 trillion in circulation around the globe. Imagine more than half of the American currency currently in existence all being poured into infrastructure.

Certainly, this isn’t an opportunity any business wants to miss out on, but how can they best prepare for this coming flood of work? In the time it’s going to take for the bill to be finalized, there are several steps that contractors can take to be ready for the infrastructure boom:

1) Have a go-to-market plan for the government

Many business owners don’t think of the government as a customer, even though they may profit greatly from doing so. Consider the explosive growth of Zoom, which was able to establish itself as an essential crutch for governments nationwide during the sudden shift to remote work during the Covid-19 pandemic.

As infrastructure projects roll out, government agencies will be looking to advance their IT security, install charging stations and solar panels and much more. Opportunities will bloom for nearly every industry due to the amount of work required and its connection to infrastructure.

Just imagine a project to rebuild a local school – likely a very common project once the bill passes, seeing as most of the nation’s schools were built in the 1940s and 1950s. To rebuild one school, the local school district would need to hire an architect to design it, an engineer to spec it and a construction company to build it. But that’s not all – the completion of an updated school would also require the following:

  • Copper, wire, pipes, steel and other essential construction components
  • Solar panels
  • Charging stations
  • Modular furniture
  • Smartboards, computers, projectors and other technology
  • Overnight security during construction
  • A construction clean-up crew

All of these and so many more details will require the support of different companies to make the project possible. Infrastructure goes beyond roads and bridges - capitalizing on this bill will mean figuring out how you can fit into the equation.

2) Start thinking nationally

Once the American Jobs Plan is enacted, procurement opportunities will appear in local communities that may have never been seen before. This will mean a bevy of opportunities for local residents, of course, but governments will likely need to go beyond the local supplier community for certain jobs.

Say a small city wants to outfit City Hall with solar panels, add charging stations at the local schools and community centers or construct a new building with smog-eating concrete. For these specialized tasks, a placement in the local newspaper may not cut it for outreach.

Government agencies will be looking for contractors on a national level, so savvy suppliers should make themselves visible on that stage however possible and be ready to meet their demands.

3) Enhance reach and visibility with technology

As technology continues to improve, we’ve embraced it to streamline many aspects of our lives. We use it for shopping, communicating, booking flights, house hunting and – lately – grabbing lunch. Every step of every process of even remote importance to us has an automatic email alert attached to it.

To successfully meet this moment, businesses should start thinking about how technology can similarly streamline their work with the government.

Finding relevant bids outside of one’s local region can be challenging under normal conditions, as governments are typically very fragmented, even within the same state. There are tools that can help, however, including many online services that can improve the bidding process for contractors. These services offer alerts whenever a government agency puts out an RFP or a bid for a relevant job anywhere in the nation – ultimately proving far easier than checking the city website or the newspaper every day.

Businesses that have already started working with the government but want to do more – or win more – would also be wise to check on its bid history. If a library needs copiers, a copier supplier might want to check what they paid in the past to ensure they’re in the right ballpark. Another way to secure more wins would be to check winning contracts that have been published by governments and consider using it as a starting point for a winning template.

Taking all these steps – whether locally or nationally – used to be a stumbling block for even the best suppliers, but constant growth in technology has taken the sting out of extending reach and improving visibility to governments.

A whirlwind of infrastructure opportunities is fast approaching, and the businesses that start using every tool they can to prepare now will be best positioned to walk away from this boom with major boosts to both their status and bottom line.

Ben Vaught is the CEO of DemandStar, an online procurement marketplace connecting government agencies with quality suppliers.

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