The Negotiator Magazine

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I once found myself sitting next to a Pentagon procurement officer on a flight to the East Coast, and I raised this point with him. "All the time I hear that the government has to buy from the lowest bidder. Is that really true?" "Heavens no," he told me. "We'd really be in trouble if that were true. Cost is far from the top of the list of what's important to us. We're far more concerned with a company's experience, the experience of the workers and the management team assigned to the product, and their ability to get the job done on time. The rules say that we should buy from the lowest bidder who we feel is capable of meeting our specifications. If we know that a particular supplier is the best one for us, we simply write the specifications to favor that supplier."

Of course, that is the key to selling to government agencies, whether it is the city, county, state, or federal government. If you want to do business with any level of government, you should become known as the most knowledgeable person in your industry, so that when the agency starts to prepare bid specifications, they welcome your advice on what they should specify. Fortunately, the trend is away from this type of direct bidding and toward the government agency hiring a private sector project manager to supervise the work. By inserting this middle person, they avoid the obligation to let bids and instead let the middle person negotiate the best deal.

So even with the federal government, price is far from the most important thing. When you're dealing with a company that doesn't have legal requirements to put out a request for bids, it's far from the top of the list.

Just for the fun of it, review the following list of things that are probably more important than price to buyers.

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November 2004