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IT Spending Expected to Top $130 Billion in 2011

 

Capitalizing on Government IT Opportunities Share This

by Brian Sherman on June 30, 2011
Tags: bkwy11, Education, Government IT, GSA, Training


IT spending by federal, state and local governments is expected to top $130 billion in 2011. That’s a significant pile of cash and has a number of VARs and MSPs wondering how they can get a piece of it. Other providers have watched from the sidelines, unsure if the government sector revenue is worth the perceived aggravation of red tape and other obstacles. Regardless of which situation describes your business, the opportunities presented by municipalities, as well as state and federal entities, are too large to ignore. At the very least, every VAR should investigate their local city or township’s IT needs, gaps and who manages it. If there’s an opportunity, why not invest some time to learn more about supporting this market and how to develop more government sales?

So, after your interest is peaked, it’s time to plan out a cost-effective way to get your foot in the door. Some companies invest a significant amount of time and money to be certified as a government contractor, but never win a bid. Others do some preliminary research and take a few superficial training courses, yet never make a commitment to enter the market successfully. There is a happy medium, but it requires a well developed plan that includes education (the basics of selling to the government), potential partnerships, and the resources required for your company to succeed.

The first thing you need to understand is the diversity among government entities, from small municipalities managed by part-time supervisors, to complex federal agencies with a number of IT services decision makers that need to be influenced. What appears to be low hanging fruit (smaller local municipalities) may turn out to be more complex than securing a larger county or state contract—and less profitable. In addition to a multitude of government agencies to choose from, some pull from multiple budgets to pay for IT projects and ongoing support. Although it may sound complex, many experienced VARs leverage the relationships they build in one department or municipality to uncover opportunities in other units or neighboring governments. As in any new market, networking and getting referrals from related clients can go a long way to helping a VAR gain a foothold.

Hone Your Government Sales Education

If you’ve determined that your company has the potential to benefit from the government sector, what’s the next step? There are two options most solution providers follow: build their own practice or partner with another IT firm with GSA contracts to deliver a wide array of services. The later choice can be complicated and reduces the revenue potential for your business, but works well when you only have a few limited government entities in your region.

Rather than invest a lot of your resources creating a new business unit, consider partnering with a complementary provider to win those accounts. If you would like to provide long-term support for prospective government clients, hand off the project work and implementation to a VAR outside your market who knows how to navigate the red tape. There are a number of ways to connect to these partners, through the OnForce website, Ingram Micro Services Network, or just by talking to other channel people you’ve met through events or associations.

If that option isn’t your “cup of tea”, then take a serious look at creating your own government IT practice. The great part is that you don’t have to make a huge investment to get the training and education you need to make your mark in this market. Many distributors and channel-specific associations offer classes, video instruction, or even mentoring to help VARs succeed in government sales.

 

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