Delving into Public Sector - January 2023
Here we are once again in a new year (Happy New Year!!!) It happens every year but somehow it seems to sneak up on us, doesn’t it? 2022 is behind us and it went out with a bang as far as some awards/changes in the Public Sector world. Overall, I think it was a good year in Public Sector, but I feel 2023 holds even better opportunities for us in this vertical.
I was speaking with Paul Holland, Managing Principal at Solomon Coyle, a couple of weeks ago and he started our conversation with a statement that encouraged me in this new year. He said, "We continue to see strength in the Government vertical in each quarter's Market Outlook survey thus far. As we complete the Q4 2022 Market Outlook report, we look for this strength in Pipeline Activity to continue. The Government vertical performed well during and post-pandemic, and we believe if we see a general softening in the economy, we expect the Government sector to be a leading segment along with Education and Healthcare." Then I came into January with projections that Federal Civilian agencies are looking at a 10% increase in budget and DOD a 6% increase and comments that most states (never all) have “full coffers”. (Shout out to my Catalyst team member, Dan Conaty, for using “coffer”in a sentence already in 2023!!)
So, what were the big changes and what should you be doing as the commercial market continues to soften, but Public Sector is continuing to do well? Let’s jump in and discuss!
So, what are the big changes/awards that happened at the end of 2022:
NCPA was acquired by OMNIA Partners! From OMINA’s press release: OMNIA Partners announces the acquisition of National Cooperative Purchase Alliance (NCPA), a leading national government purchasing cooperative based in Houston, TX. This most recent acquisition enriches OMNIA Partners as the nation's most experienced cooperative purchasing organization serving state and local government, K-12 education, and higher education institutions.
The Air Force awarded their systems contract to 6 manufacturers!
VHA IDIQ opened up for new products to be added
Packaged Office program went from letter of supply to CTAs
The U.S. Small Business Administration (SBA) has terminated a class waiver of the Nonmanufacturer Rule (NMR) for multiple NAICS codes
I am sure this is not EVERYTHING that happened, but these are the ones that I think we need to address the obvious questions “So, what does this mean for me?” and “How do I take advantage of these changes?” Today I will address 1-3 on the list.
Let’s start with the OMNIA acquisition. First, if you already hold an NCPA contract it is business as usual FOR NOW, but you should feel like you just won the Cooperative lottery! OMNIA is the most sought-after cooperative and it is not easy to get on. As you create your strategy for NCPA you should also be thinking OMNIA. OMNIA’s furniture contracts see over $800M in revenue each year. That is bigger than the GSA contract furniture market! You will need a strategy and a person/people to help you make this contract successful for your company.
The Air Force Systems furniture and walls award is done!! This is a big deal on the Federal side. There used to be a BPA, but it has not been in place for years. Officially 6 manufacturers received a contract within the Air Force OWFP to offer Systems, Demountable Walls and ancillary products through a mandatory sourcing two-tiered program. So, now we are down to 6 manufacturers who can sell systems to the Air Force through this mandated contract. If you are aligned and your manufacturer is not on the list, there are some manufacturers looking for dealer partners.
The Veterans Health Administration has had a furniture IDIQ in place for about 5 years now, with annual spend of $130M+ per year. There are 9 awardees- all dealers and all Service-disabled veterans (SDVOSB). After a small hiatus, the VHA opened up the contract for price increase as well as deletions and additions of products. If you are a dealer that has VHA clients, but not an awardee, find a partner to work with that holds the IDIQ. Most of them are willing to partner. If you are a manufacturer and are not on the IDIQ, create your plan to get on the next go around - possibly end of 2023.
I hope that you agree that 2023 will be exciting for Public Sector!! Next month we will discuss the changes to the Packaged Office program and to the U.S. Small Business Administration (SBA).
I look forward to meeting you here monthly to see how everything shakes out and what new happenings we can delve into!
Cheers to a successful 2023 in Public Sector!!
ABOUT MICHELLE WARREN
Founder, President - Catalyst Consulting Group
Michelle Warren is President of Catalyst Consulting Group, a firm specializing in providing strategic solutions to the commercial furniture industry to enhance their sales, positioning, and distribution. With 25 years of industry experience on the dealer and manufacturer side of the industry, Michelle has been recognized as an innovator in selling to the Federal Government, State/Local Government, Higher Education and Cooperative Purchasing. Her expertise includes: sales strategies, strategic planning, 3-5 year road mapping, targeted marketing plans, distribution development, hiring reps, and training for reps and/or dealers. Michelle is known as a “serial networker” in the furniture industry and enjoys meeting people and making connections happen. If you’re interested in connecting - reach out at: Michelle@strategic-catalyst.com, connect on LinkedIn or visit www.strategic-catalyst.com to learn more about her work.
As seen in Delve | January 2023 V.34