How the Continuing Resolution Affects the Federal Budget Cycle

This week I am going to discuss (CR) or Continuing Resolution by congress for the Federal Budget. You may or may not be aware but this year will mark the 20th year in a row that Congress will not pass a budget. Instead we get a Continued Resolution by congress to fund the federal government for the year. 2014 will certainly be no different. So in this newsletter I am going to write about how to market your firm to the federal government during the different phases of the Continuing Resolution. (The Federal Governments year end is September 30th)

“Tight Belt” October 1 – January 15th

Congress and the President due to political posturing may shut the government down for a day or two during this part of the year but this will not affect overall purchasing of the individual agencies. During this part of the year many federal agencies are authorized to spend at between the 90-100% level from the previous year. This is a budgetary safeguard to attempt to shield the agency from a shrinking full year budget. During this phase it is key that the government contractor focuses on services that enhance existing or ongoing mission requirements. Attempting to sell a new solution for the most part is a wasted effort. If possible, when selling to the government attempt to break items down into monthly installments for the agency. An example would be a monthly fee for a license of software rather than a one-time lump sum payment.

“Gasp of Air” January 15th – July 31st

this is the “normal time of the year” the budget shakeout occurs after congress returns from Christmas break. Then business as usual returns and agencies return to spending on ongoing programs. Contracts are "hit and miss" during this period of time, this is a good period for RFQs as the procurement personnel have the go-ahead on innovative projects and have more time to sort out the different solutions provided by varying contractors.

“Teenager with Daddy’s Credit Card” August 1st - September 30th

Agencies spend a large portion of their budgets in the fourth quarter but the month of September carries with it the use it or lose it deadline. Many large federal contracts have been penned during the waning hours of the month of September and in some instances being at the right place at the right time can be your best ally.

For most firms undertaking the process of obtaining their GSA Schedule, the process for obtaining a schedule is usually approximately 4-6 months. The ideal time to receive your GSA Contract award is shortly after January 15th, but long enough before the August-September blitz that the new schedule holder has time to get their feet wet. So moving forward in the next month can be a great time to start the GSA application process.

A GSA Schedule is your first step in entering the federal marektplace. If you would like for me to run an analysis for your firm to see what type of impact a GSA Schedule could provide your business, give me a call and I am always happy to discuss. Knowing the size of the federal marketplace in your industry is the first step in making a strategic deicsion as to whether you should view the federal government as a growth are for your business. Please feel free to give me a call at 303-810-4580.