Summary: It is never enough to know what to do in government procurement process. Contractors should also know how to do the crucial steps that might make or break their business ventures.
There’s more to government procurement process that contractors need to learn aside from the proper product placements and pricing. It is also not enough to know how the process goes – entrepreneurs should also know how to keep going and the ways to maintain smooth business transactions.
Decision Point
The government procurement process obviously starts when the contractors decide to establish a business inclined to supplying the needs of the government. Most entrepreneurs make a mistake of immediately investing in raw materials even before they have assessed their capability of fulfilling their long-term goals. Thorough research on the current demands of the government as well as the right pricing schemes that can fuel the government procurement process can help, but this doesn’t mean that the contractors should neglect their purpose for entering the business in the first place.
Note that a government procurement process can have an ideal start when the contractors have the following:
- 1. High level of motivation. When the contractors feel half-hearted in entering the government procurement biz, they might as well disregard the thought of getting the government as their client. The market comes with tight competition among contractors who follow complex processes, and thus, patience and perseverance is highly required in this kind of venture. Entrepreneurs with hesitation and lack of commitment are less likely to thrive as they go through the government procurement process.
- 2. Financial Stability. Contractors should have enough finances to establish long-term business with the government. Prior to the bidding and negotiation, entrepreneurs should ensure that the company has strong cash flow to finance the purchase of raw materials. The government usually ask for financial statements or posting of surety bonds before the government procurement process start.
- Efficiency of Operation. There should be a thorough assessment in the part of the contractors if their companies conform with the standards set when it comes to the assurance of quality and compliance with the ISO. More importantly, contractors should have maintained good records from past negotiations.
- Up-to-date machineries and equipment. This is actually one of the soundest investments a contractor can make during the government procurement process. Sophisticated computerization of records and procedures may impress government agencies and provide protection to important business documents
- Financial discipline. There should be a clear division between personal and business expenses in order to ensure a smooth-flowing government procurement process. In addition to this, it is a must for the contractors to first have a knowledge on financial management and competitive pricing early on.
Registration
Having the company included in the list of qualified contractors through proper registration becomes the second step for the government procurement process. Most states have already utilized the Internet for registration to give ease and convenience to smaller scale enterprises. During the registration, the following information is provided to the government agencies:
- Background information about the contractor, company and finances
- Criminal records and taxpaying history
- Product information
- Pricing schemes
- Possible discounts and deals
- Past business ventures and the clients’ feedback
Bidding and Negotiating
These are the last procedures in the primary steps of the government procurement process. Prior to the acquisition of supplies from the contractors, the government agency will carefully select among the companies who submitted their proposals which can either be in the form of sealed bids (when time is limited) or negotiations where both parties discuss the provisions included in the proposal. The contractors who won contracts will then move on to the process of exchange of goods and services.
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