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Wheeling and dealing with Uncle Sam
October 13, 2006
Wheeling and dealing with Uncle Sam
Canadian companies have an impressive record when it comes to winning big contracts from the
U.S. government. In 2005, for example, Uncle Sam awarded more than 700 Canadian exporters
with over $1 billion in prime contracts for goods and services, an increase of about 12% from the
year before. This success owes as much to American confidence in Canadian quality as it does to
our approach and contracting know-how.
One way exporters can do business with the U.S. government is through General Service
Administration Schedule Contracts or GSA schedules (see World’s biggest customer may want
you) which cover 53 different groups of products and services. But it’s not the only way.
What’s the GWAC?
Another important way to win contracts with Uncle Sam is through Government-Wide
Acquisition Contracts, or GWACs. This is only for technology products and services.
Technology companies can use either GSA schedules or GWACs, or both, but there are
differences. GSA schedule contracts require that offerings be available on the commercial market
and GWACs do not. Another difference is that GSA schedules are open to new vendors all year
long but GWACs have bid closing dates.
Another method is through Simplified Acquisition Procedures which account for about 11% of
Canada’s contracting total. These contracts are used for transactions worth less than $100,000.
However, these smaller contracts don’t mean that they are limited to small businesses; the top six
companies using Simplified Acquisition Procedures each reported sales of over a million dollars.
Did you know?
The Canadian Commercial Corporation (CCC) handled 75% of Canada’s export sales to the U.S.
military, which hit a record high in 2004-2005. CCC’s services include pre-contract review and
post-contract prompt payment.
Tom DeWolf, CCC’s Director of Business Development for Aerospace, Defence and Security,
says orders in his sector using CCC’s contracting services amounted to $1.4 billion in sales
in
2004-2005, including over
$1 billion to the U.S. Department
of Defense alone.
“CCC continues to strengthen our relationships with both U.S. buying agencies and the Canadian
industrial base to connect Canada’s top suppliers with the world’s largest customer,”
says
DeWolf.
For more information, go to www.ccc.ca.
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More than just contracts
But how important is the contract type? Judy Bradt, a former Canadian trade commissioner who
has helped thousands of Canadian companies win U.S. government work, says it’s just one piece
of the pie.
“Most vendors start by focusing on the procurement process. You have to do that, but it’s not
enough. Vendors start to make headway when they realize they need relationships with people,
because many jobs depend on a contractor’s performance,” she says.
“Then the light comes on,” she adds. “Buyers choose the vendors they trust most to solve their
problems. That’s what’s so impressive about recent Canadian winners. They’ve worked hard to
build deep trusting relationships.”
Canadian success by the numbers
Two of those companies are Forensic Technology Systems of Montreal and Nightingale of
Toronto, which each won contracts worth about $17 million. They led nearly 200 Canadian
companies that won a total of some $123 million in U.S. federal prime contracts for IT and
telecommunication solutions last year.
The U.S. Department of Defense was Canada’s top U.S. government customer, accounting for
three quarters of its total. Some top companies making major sales to the U.S. military were
Med-Eng of Ottawa, a company that makes protective gear for people who disable explosive
devices, Lotek Wireless of St. John’s and Toronto that makes transmitters for fish and wildlife
tracking, and Norsat International of Burnaby that provides intelligent satellite solutions.
“Canada’s growth in awarded contracts reflects the confidence that Americans have in Canadian
firms, ” says Bradt, who points out that every contract, whether for military or civilian clients, is
an impressive business achievement that demonstrates exceptional marketing skill as well the
ability to meet demanding performance standards.
But two things matter much more than the type of contract, she cautions. Canadian companies
need to find out how their best prospects buy the kind of product or service that the company
sells and what the most effective strategy is to reach those buyers.
“After all, GSA schedule and GWAC contracts account for less than 15% of the value of all U.S.
government purchasing,” she says. The U.S. government uses a wide range of other contracts and
acquisition strategies for the rest of its purchases.
To learn more about Simplified Acquisition Procedures, SmartCard, Basic Ordering Agreements,
Negotiated Procurement (like requests for proposals), and Invitations for Bid (also known as
Sealed Bidding), go to www.arnet.gov.
Helpful websites
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