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[T1422]Types Of Government Contracts

by Joshua Feinberg, Jos

Many IT consulting firms go after government contracts because they are attached to misperceptions about this type of work being easy money. Most IT consulting terms will end up being frustrated by the amount of work associated with government contracts, and therefore have to consider the various pros and cons before getting involved.

Pros of Government Contracts for It Consulting Firms

The biggest advantage to working with a government agency for IT consulting firms is the potential money that can be made. While there are both small and large contracts available in the market, the larger contracts can pay enough to sustain IT consulting firms far into the future with guaranteed paychecks. The government, unlike small businesses or individuals, will not run out of money all of a sudden.

Working with government contracts also means you will be able to get in contact with people easily because public directories exist both online and on paper with names and job titles of decision makers.

IT consulting firms with a good relationship with government agencies will find themselves with many advantages, including future referrals that could lead to more contracts in the future.

Cons of Government Contracts For It Consulting Firms

While payment is guaranteed in government contracts, the paychecks could come very slowly. There will also probably be time delays for approvals of aspects of jobs because there may be multiple decision makers involved. Sometimes similarly, one decision maker might turn a job down and cause you to lose a contract.

Often with government contracts there is also a great deal of paperwork, so you will probably spend a lot of time filling out documentation and forms.

As an IT consulting firm, you should look into all the advantages and disadvantages of government contracts in order to insure less frustration and greater benefits.

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Assess what kind of skills you are bringing to the table and see how close you are to being able to being that deep into a few skills, because that is what these medium sized businesses are looking for. They are not looking for an outsourced version of a central IT manager.

Going after government, city, state, municipality, public school districts, etc. involves bids, bid packets, bid surety bonds, long sales cycles, and a lot of politics. This stage of the game is a very different business model, very different than selling to the sweet spot of small businesses or even small businesses in general.

Only go after these kinds of things after you have completely exhausted and completely saturated your sweet spot marketing roll out. In other words, don't persue them until most of the sweet spot small businesses within a 50 mile radius know who you are, they are in your prospect funnel, and you have grown them to the point that you have absolutely maximized them out and you still don't have enough business. This is pretty unlikely unless you are in the absolute middle of nowhere.

You should consider supplementing your business base with some high-end micros- and some medium sized businesses before going after government work. This is because of the level of aggravation with the bids, then the politics and the waiting to get paid. It's not a very good place for people to be - especially in their start up stage.

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Joshua Feinberg has sinced written about articles on various topics from Adwords, Business Plan and Information Technology. Joshua Feinberg helps computer consultant business owners get steady, high-paying clients. Sign-up now for Joshua's free audio training that shows you how to use field-tested, proven Small Biz Tech Talk tools at http://www.SmallBizTechTalk.com/blog. Joshua Feinberg's top article generates over 1000000 views. to your Favourites.