Connecting state and local government leaders
Diversifying among more levels of the government contracting market is a start.
Vendors with a data-driven strategy for allocating sales resources among all five levels of the fragmented state, local and education (SLED) government contracting market are most successful, according to a new Onvia report.
Procurement data shows city and state agencies comprise the largest project bid volume, but the agencies most actively issuing awards are a small percentage of the market.
The SLED market, estimated at $1.5 trillion, is about three times larger than the federal market with more than 90,000 procurement entities and 400,000 annual bids and request for proposals (RFPs), per the report:
While identifying the share of bids and RFPs at each agency level represents a good starting point for planning a sales strategy, it’s not the only decision factor available: Vendors can also consider factors such as award values, win rates, agency relationships, competitive challenges, etc.
Knowing the size and composition of the vendor’s target market is critical, according to the Seattle-based government business intelligence company, with each SLED level’s share of total annual bids and RFPs as follows: 33.8 percent for cities; 26.6 percent for states; 17 percent for counties; 11.7 percent for education like school districts; and 10.9 percent for special districts like utilities.
Onvia broke down opportunities among the five SLED levels between 17 major industry segments, as seen here:
State contracting is strong across most industries but lowest when it comes to industrial supplies opportunities and higher than all other SLED levels for healthcare opportunities.
The education SLED level and educational services industry segments are two very different animals, with state agencies like public universities and education departments major procurement players.
Other findings of note: The overall average contract across all industries is worth $2.4 million, and while the top 10 city agencies account for 13 percent of all contract dollars, they only represent 5 percent of all opportunities—both small slices of the total market.
Onvia’s full report also looks at opportunities by award value, typical SLED project values and award values by agency type and can be found here.
Dave Nyczepir is a News Editor for Government Executive’s Route Fifty.