5 reasons you should Consider government as a customer

April 03, 2019

Why take on government work-01

Many businesses consider working with government to grow and build a sustainable revenue base. However, a large number also shy away from tendering for these contracts because they are unsure the government will engage with them.

Maybe they don’t think they are big enough to support government? Or are unaware of the opportunities that are available? Is it the perception that government customers can be difficult to work with?

Maybe it’s time to reevaluate. Government customers can be extremely lucrative and an excellent opportunity to develop your business. But you need to be ready to invest your time, resources and focus in order to make the most of any opportunities you are successful with for the long term.

Here's our top 5 reasons to consider government as a customer:

GOVERNMENT CONTRACTS OFFER NEW OPPORTUNITIES

Government work comes in all shapes and sizes and most importantly provides interesting and varied work that is not available in the private sector. This can provide you a competitive advantage in your industry, opening a whole range of opportunities.

It is a common misconception that “government wouldn’t be interested in what I do”, which is often not true. There are many facets to government, and they are a massive consumer of all types of products and services.

tHEY'RE NOT ALWAYS AFTER THE CHEAPEST OPTION

There is a difference between cost and value, and often you’ll find that government customers are after the latter. In fact, government often see prices that are too low as a risk. That’s because they have a vested interest in your sustainability and if it seems like your margins are too low there’s a good chance that your cash flow is under some serious pressure, which could jeopardise your ability to supply them.

Government are great payers

Unlike the private sector and commercial work where you may experience long payment terms, government have a policy that invoices must be paid within 30 days. They often award longer term multi-year contracts, providing a steady cash flow stream that’s guaranteed to be paid, taking the pressure off cash flow and supporting your long-term growth strategy.

It can lead to big opportunities

There’s an old adage – the hardest government contract to win is your first. If you do a good job, it’s very likely you’ll be invited back. Usually your contract will grow over its life, and new work is frequently offered whilst you’re already supplying them, especially if you have a focus on adding value to their needs.

Government look great as a reference

There’s almost no better kind of customer to have as a reference when trying to win new business, attract potential investors or bring on new talent. It can even increase the value or your business when the time might come to sell. Government contracts not only provide financial benefits but also demonstrates your ability to support and supply a customer that is expecting a high standard.

 

Successfully winning a government contract can be one of the best things your business will ever do. It can provide you a secure revenue stream, plenty of opportunity for follow on work and will add a ton of credibility to your business.

The fact is, government want to work with and support new and innovative local businesses. They’re fundamentally invested in the growth of Australian businesses, so instead of wondering if government want to hear from you, take the chance, it could well be the best business decision you ever make.