Government Agencies’ Small-Dollar Purchases Can Translate into a Big Win for Your Business

While the average turnaround time for a government contract solicitation may only be 21 days, the number of hours – and days – that your team collectively commits to preparing a proposal can amount to much more than three weeks’ worth of work. In fact, some say that the resources required to respond to even a single RFP or bid makes the pursuit of government business restrictive for many private businesses. And that’s why we’re here to tell you that there could be another way to secure sales revenue from the public sector: micro purchases.

Nearly all federal, state and local government agencies have the authority to make purchases under a certain dollar amount without having to go through a formal RFP or bidding process. You may hear these types of purchases called small-dollar purchases, micro-purchases, simplified acquisitions or “government purchase card” (GPC) programs depending on the agency, the type of good or service being sought and the monetary threshold.

The beauty of these types of buys are that small businesses, or companies that have never done business with the government before, could technically secure a sale without having to go through the rigorous bidding process that most associate with government contracting. Sometimes, these types of purchases are made using reverse auctions, statewide or co-op contracts. However, if you market your business to government agencies and can successfully increase awareness of your products and services, then it’s very possible they could pick up the phone and call you to make a small-dollar purchase several times a year – which can quickly add up.  

Even if they only buy from you one time, that sale prompts a performance record that could benefit you when it comes time to bid on larger contracts.

However…

Government agencies can only buy from companies that are already registered as vendors in their system of choice. And, agencies with small, minority, local or veteran-owned preference programs will often prioritize purchases from such certified businesses first. In a way, it really is an advantage to be a disadvantaged business when it comes to public sector sales.

So, take a few minutes now to read up on what it takes to get registered and then start marketing your business to the federal, state and local government agencies that you think could most benefit from your goods or services.