Techniques for Securing Defence Contracts

This article is written with years of experience of seasoned defence contractors in the industry. However, the tips in this article are not exhaustive and contractors must develop their own resources in order to make these tips effective in their business. The below are general guidelines for securing defence contracts and are a great headway to companies looking to penetrate in government contracting business.

The current geo-political scenario is threatening towards a third world war. All nations big or small are constantly trying to protect their borders with newer technologies and products making defence procurement very lucrative. The defence business has never been in demand so much as it is today which is why Defence product manufacturers are having a busy time at work. All defence manufacturers dream to secure government contracts of any size to secure their business. Since government business and contracts come with repeat assurance, it is very lucrative for companies to secure defence contracts directly from governments.

The Defence industry is a relatively small industry but has risen and grown many folds over the last decade. Evolving technologies in air, land and marine have contributed to an overall growth in the industry. However, the industry has its limitations with certain products such as ammunition, guns etc which are restricted to be sold to private businesses. Therefore, defence manufacturers have to rely heavily on the government for their business. Business can come in the form of government tenders or via providing the products as third party contractors to companies who have secured the tenders. In either case, the limited nature of requirement makes securing defence contracts very attractive for companies. Let us explore a few tips on how companies can do this.

Understand the Market

One of the foremost things to do while securing defence contracts is to understand the global and local markets. This enables contractors to adjust their products as per the local and global standards. For instance, body armour vests have undergone various tests over the years and the latest NIJ standards changing every few years. Products must therefore be made compatible with the latest standards so as to poise the company to deliver the goods whenever an opportunity arises.

Understanding the market also helps developing breakthrough technology products taking inputs from the key stakeholders on the problems and finding precise solutions for it. There are various ways in which contractors may understand the market. One of the primary ways to do so is by monitoring bids and tenders through an aggregator service like Tender Impulse. This enables contractors to monitor bids going around all over the world so that they can see what sort of procurement is happening around. These services also allow contractors to bid in live opportunities while also using the database as a market research tool.

Product/Service Development

Thousands of defence products are made every year and many of them are scrapped due to inefficiencies or technology takeover. Contractors must therefore aim to build products that are robust and stand the test of time. Products must also adhere to certifications and standards as set out by the authorities along with ensuring that new technology does not take over the products key features. A lot of research and development goes into new product development which must not be ignored. Companies must strive to work with the stakeholders in each and every step as product development is both time and resource consuming. Failure in new product launches could result in heavy losses which can only be avoided by thorough research and development.

Focus on Long Term Relationship

Government contracting is a long term game and contractors must seek to establish long term relationships with authorities. This can be done by various communication modes, attending pre-bid meetings and even participating in events organized by authorities. Trade shows and exhibitions are another way to interact with the officials and showcase the products. Although government tendering is regulated by laws and is transparent, maintaining good relationships with key stakeholders is a great way of ensuring your company is highlighted in front of the authorities.

Targeting Key Markets

Even though the defence industry is a relatively niche industry, it is always a good idea to focus on a geographical market. Doing this shall enable contractors to fully understand the local happenings and shape their products accordingly. For land defence, this is an excellent idea since major land defence products are customized as per their use in different geographies. Focussing on a particular geography also allows companies to have more chances to interact with the officials and be known to them. It also enhances the chances of maintaining good relationships as industry peers and authorities alike are more prone to know your company given your frequent participation in bids in that region.

Building Industry Network:

Being a close knit and a niche industry, defence contractors do not have competitors; they have allies! Companies must be fully co-operative with existing competitors and understand the ecosystem to better present their offering. Peer discussion also helps in assessing the key loopholes in a product or service so that they can customize and give a better offering of their product thus increasing winning chances. A good idea is to participate in industry discussions, trade sessions, and network events.

Finally, the above steps are no guarantee to secure defence contracts but can go a long way in achieving the desired goal. Government contracting is a tricky business but if done rightly can lead the business to newer heights. The mountain of responsibility that comes with government contracting can only be tackled using patience, R&D as a key component and using soft skills to work together with industry peers rather than working against them.