Business to Government (B2G) refers to when a business sells products, information, or services to federal, state, or local government agencies. With this business model, businesses must bid for contracts by submitting responses to a request for proposal (RFP) solicited by a government agency.
Every year government agencies solicit contracts or tenders worth billions to businesses of varying sizes. In fact, the United States government spends nearly $7 trillion on government procurement every year, making up between 10%-15% of the country's GDP.
B2G refers to the business model where government agencies procure services, information, or products from outside contractors. Whether they're purchasing business phone systems from network providers or making use of time and attendance software, government agencies perform a B2G transaction every time they purchase services, software, or information from other businesses.
The B2G business model provides a way for businesses to bid on government projects or market their products to government agencies that might need it. Essentially, if your business has something a government agency needs, you are able to perform a B2G transaction.
Examples of B2G Transactions:
Businesses that specialize in construction frequently perform B2G transactions with government agencies. In this example, government agencies will solicit requests for proposals (RFPs) that detail the work needed for the construction of new buildings, park developments, libraries, schools, or road construction. When an agency approves the tender of a business, they enter a B2G relationship.
Government agencies will often purchase a unified communications solution to remain in contact with colleagues and other government agencies. Government offices perform a B2G transaction when they purchase this service from other businesses.
A database development company can provide a system for local government offices to locate tax forms for investment income, equipment depreciation, and commercial purchases. In this example, businesses of varying sizes can market their software development services to government agencies.
Maintenance services are a great example of B2G transactions. To maintain public buildings and open spaces, government agencies may solicit the services from outside contractors. For example, an agency could hire a gardening service to maintain its public parks.
Examples of B2G Companies:
Riskpulse provides a risk management and supply chain solution to government agencies. The solution effectively helps reduce operational costs, minimize disruptions, while estimating the chances of delivering early, late, or within a specific delivery window. Riskpulse is used in different industries, including healthcare, transportation, energy, and defense.
Senseware provides a full-stack IoT platform with hardware, cloud-data, and software solutions. Senseware works to capture real-time energy submetering, IAQ, and HVAC operational data. Government agencies make use of their solutions to better integrate, manage, and monitor building systems.
Skycatch is an enterprise-grade aerial intelligence platform and an industry-leader for data imaging. Government agencies make use of Skycatch's onsite connectivity, powerful Artificial Intelligence and Machine Learning algorithms, and powerful analysis tools to better plan projects.
OpenGov provides an industry-leading cloud-based software for public sector budgeting, reporting, communications, and performance. OpenGov's multi-tenant Software-as-a-Service (SaaS) connects over 1000 government agencies, providing features like budget management, direct feedback, online forums, digital surveys, and performance reporting.
What is the government procurement process?
- A government agency solicits a request for proposal (RFP) on a registered government site.
- A business will then create a presentation that will highlight the value of their business and what they can add to the project.
- Your proposal will then go through to the evaluation process. This process might take some time but if you do get the tender, you will be notified. Rejected proposals will also be explained. The agency will send you a note explaining where your proposal was lacking.
How To Make B2G Sales As A Small Business:
1. Partner with established contractors.
Government agencies prefer working with businesses that have prior experience working on government projects. This makes it hard for startups and small businesses who want to market their services and products. To combat this issue, businesses will often partner with contractors as a subcontractor. While this option is not as profitable, it's a great way to start building experience.
In addition, continue to build your experience by working with other businesses and independent clients. As your resume improves, so will your credibility. While it's rare, government agencies might give your business a chance if they see you've worked on major projects and with established businesses.
2. Market your services or products.
Directly reaching out to businesses is often discouraged. However, cold calling government agencies could be effective. For example, if you heard your local government is launching a new project to build three new public parks in your vicinity, you could see this new development as a great opportunity to reach out and start marketing your business.
3. Make sure you meet all the project requirements.
When a government agency releases the details of a new project, the agency will indicate what skills and expertise they require for the job. Don't respond to an RFP if you do not meet all or most of the requirements.
4. Register your business.
When government agencies are on the lookout for a new contractor, they will solicit the opportunity on one or more government sites such as the General Services Administration (GSA), Global Tenders, and the NYS Contract Reporter. For an added advantage, make sure your business is registered on all the necessary platforms.
Sources for Procuring B2G Projects:
Government buildings and real estate.
Small business contractors
Federal projects worth over $25,000.
All sectors and countries.
Federal, state and local government bids.
New York contractors.
All sectors and countries.
Canadian businesses looking for tender information on U.S. government agencies.
Federal, state and local government bids.
Large contractors searching for small businesses to serve as subcontractors.
What is the role of the General Services Administration?
The General Services Administration (GSA) serves as the federal government's lead acquisition agency, creating and implementing regulations on products and services purchased for the U.S. government.
B2G Business Proposal:
When you send in a proposal highlighting the value of your business, make sure your proposal is well-structured and professional. In addition, your proposal should list all the risk factors the project may cause and how your business plans on addressing these risks.
Other important details to include are:
- An outline of your proposed solution.
- Honest pricing requirements and estimations.
- An estimated time period for the project to be completed.
- Information about your company. Include your history, formation, contact details (email, fax, phone number, etc.), and any social media details.
- Your business and personal qualifications, awards, expertise, and experience.
- The difference between your proposal and other business proposals.
What does B2G mean?
B2G stands for Business to Government and refers to a business model where government agencies purchase services, information, or products from other businesses.
What is government to business e-commerce?
Business-to-government e-commerce refers to commerce between businesses and the public sector. Generally, it involves the use of the internet for public procurement, licensing procedures, and other government-related processes. For example, every year a business is expected to pay taxes, file reports, or sell goods and services to government agencies.
What companies sell to the government?
Almost any registered business can sell their services or products to government agencies. Your business has to have something the agency needs, whether its software, stationary, or information.
What is an example of a business to government company?
Senseware is an example of a B2G company because they provide agencies with a full-stack IoT platform, capturing real-time energy submetering, IAQ, and HVAC operational data. We listed more examples of B2G companies above.