Navigating 8(a) Graduation: 6 Key Sales Strategies

March 21, 2024 | Uncategorized

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As an 8(a) small business, graduation can be challenging. Your current customers likely tend to buy from 8(a) small businesses and don’t want to change that trend. However, with the right strategies, you can position yourself for continued success in the competitive federal marketplace. Here are six key sales strategies to consider as you approach 8(a) graduation:

    1. Focus on Sales-Related Activities: Increase your sales resources and focus most of your time on pre-acquisition activities, including making calls and emails, prospect meetings, industry days, conferences, and RFI submissions. Building a strong network will open doors to new opportunities. If your plan up until now has been responding to solicitations posted in SAM, now is the time to shift most of your time to sales activities. Remember, responding to solicitations is not a sales activity.
    2. Re-Study Who Buys What You Sell: Review your market research and make necessary adjustments. Study agencies that tend to buy what you sell but do so as a full and open or small business set aside. Furthermore, discover which agencies are buying using the contract vehicles you possess. 
    3. Diversify Your Customer Base: Don’t rely solely on your customers, who tend to buy from 8(a) firms. Leverage your past performance to work with other agencies. Pick two or three agencies as new targets based on your research from #2 and begin prospecting to them with the same intensity you did when you were a start-up. Remember, it takes time to build new relationships regardless of whether or not you have past performance. This is why it’s crucial to begin this relationship-building process well before graduation.
    4. Form Teaming Partnerships: If you haven’t already included 8(a) companies in your teaming partner strategy, now’s the time.  Partner with other 8(a) businesses that can complement your offerings or provide expertise in areas you may lack. Help position them with your current customers so the government can continue to buy from 8(a) companies and maintain the stability of working with your people. Approach mentor/protege and JV relationships carefully. Do a teaming agreement with them first to see how they operate.
    5. Proactive Business Planning: Begin your graduation planning well before the actual date. Start by assessing your company’s capabilities, strengths, and weaknesses. Identify your current contracts and how losing your 8(a) status could affect them. Make a financial projection of when these contracts will no longer provide revenue for your company. Identify areas in your back office that need improvement and increased efficiency. Instead of throwing people at a problem, leverage technology to do more with the same number of employees. This often requires a capital investment, and what better time than when you have incoming revenue?
    6. Be Open to an Acquisition: In government contracting, companies often purchase B2G companies, especially if the acquirer needs govcon experience or relationships with specific agencies. In the case of an 8(a) company, one 8(a) could purchase graduating 8(a) and still remain in the 8(a) program if, by acquiring the company, they do not exceed the small business NAICS CODE threshold (revenue or employee count).

If you have yet to win many, if any, contracts during your 8(a) period, there’s still time. To steal a basketball term, it’s going to take a “full-court press” on the items above. In this scenario, I would spend most of my time on numbers one, two, and three. If you’re reading this and haven’t yet submitted your application for the 8(a) program, hold off until you fully understand the process of selling to the Federal government AND have won a handful of contracts. Don’t spend precious 8(a) time figuring this stuff out. Just being accepted into the 8(a) will not win you government contracts. Communicating your value, being super-responsive to your customers, and solving the government’s problems will ensure success regardless of your set-aside status.

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MYTH: Government agencies only do business with large businesses.

FACT: Each government agency sets goals each year on how much money they will spend with small business concerns (traditional small business, woman owned small business, minority owned small business, veteran owned small business, hubzone etc). Some agencies have set their goal to award 30% of their dollars spent to some type of small business concern.