Government Contracts in 2021 – What’s Ahead?

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Government Contracts in 2021 are much more favorable to new vendors, now is the time to expand your business in this sector.

The Government Spent More During the Pandemic Than it Did Pre-Pandemic:

 According to the data released by Bloomberg Government on October 6, 2020 civilian agencies spent a whopping 17% more in FY 2020 than in FY 2019. At $228 Billion for FY 2020, civilian agencies spent $33.5 Billion more than in FY 2019.

Spending did not increase unilaterally across agencies though. With the pandemic raging, spending increased most in the Department of Health and Human Services (HHS) and Department of Veterans Affairs (VA) with the Department of Energy (DOE) also increasing. For HHS, contracting obligations jumped from $26.6 billion in fiscal 2019 to $41.2 billion in fiscal 2020, an increase of about 55%!

If you provide medical supplies, materials, or equipment now would be a great time to look at HHS which accounted for about 44% of the overall increase in civilian spending. 

The Government is Capable of Change, But it is Not as Coordinated as Industry Might Have Hoped:

Thanks to the pandemic we saw the government make some notable changes during 2020. One significant change was the rapid shift from on-site, face-to-face industry days to substantially more virtual industry days.  For many agencies it became clear quickly that there would not be a way to safely invite contractors to their sites for industry days during 2020. As a result, the pandemic really put change management on a stage.

Many agencies shifted their focus to using government compliant platforms to host virtual information sessions instead of asking contractors to fork up the cost of travel to attend industry days. This shift to virtual events paid off for both industry and government with attendance at virtual industry events far exceeding in-person events. According to Melissa Oh with the Department of Homeland Security’s Silicon Valley Innovation Program (SVIP) , virtual industry days are here to stay. Not only do these virtual events make government contracting more accessible for small businesses it also gives the government an opportunity to get familiar with providers throughout the country.

This is a win-win situation that will act as a door opener for businesses that have not previously contracted with the government.

On-Ramps and Best-in-Class Contracting Vehicles

As part of a strong small business government contracting strategy, leaders should be preparing for the onslaught of contracting vehicle on ramps scheduled to happen in 2021.  Contract vehicles slated for release in 2021 include the NITAAC CIO-SP4 solicitation, 8(a) STARS III award, and the SeaPort-NxG On-Ramp solicitation.

In 2020 the most successful small businesses made themselves available to their government customers using numerous Multiple Award Contracts (MACs) to make as many funding avenues available as possible. According to the folks over at TargetGov, “aggressively growing small businesses pursue and win multiple MACS, with the top small businesses holding 13 MACs on average.” 

This might seem like a lot of work for an uncertain reward but making the government customer’s job easier by providing easily accessible funding avenues will pay off. 


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