GOVERNMENT AUCTIONS - HOW TO GET THE CONTRACTS

by Deb Weidenhamer

Everyone has heard about "secret" government auctions where $50 Jeeps and $1,000 Lear Jets are sold; and many auctioneers seem almost as eager to believe that contracting with the government is just as "secret" a process. I have yet to see these great bargains happen at a government auction and I know there are no secrets involved in contracting with the government either.

Almost every city, county, state and federal agency sends surplus or confiscated property to an auction. Government auctions are shrouded in such secrecy from how auction companies contract to conduct the auctions to where prospective bidders find out about government auctions. My office alone takes more than fifty telephone calls a week from prospective bidders inquiring about "secret" government auctions - which aren’t secret at all. There really is no mystery about government work, you just need to start bidding on contracts and soon you will be conducting government auctions.

The first step is to find out where the auctions are being conducted; you will need to obtain a list of government agency’s procurement offices. Most states have an Office of Cities and Counties that produces a list for $5-$10. Once you have the list you will want to have your company’s information placed on a vendor’s list for the agency you would like to work with. There are three ways in which your information can get to these agencies; you can call, write or subscribe to a service that makes your company aware of upcoming bid opportunities; I have done all three and recommend writing. Mail a simple postcard that states "we request our company’s information be placed on the vendor’s list for upcoming contracting opportunities in auctioneering or liquidation services." Remember to include your company’s name, address and telephone number. If you decide to make telephone calls, be prepared to stay on hold and probably be told your request needs to be in writing. If you subscribe to a service such as Bid Source, be aware that there is not a SIC code for auctioneering services which makes it difficult for these services to flag bidding opportunities for your company. When I subscribed, to this service they missed five bid opportunities in one month.

The government office will notify you when an auction is coming up for bid by sending you a Request For Proposal (RFP). Once you receive the RFP read through the entire document and highlight areas of concern such as costs, who pays advertising, how much staff is required, is there a delay in reimbursement of costs and etc. Read very, very carefully because you will need to fulfill and address every point in the RFP. Make a list of your company’s expertise along with areas that will be hard to address within the RFP. The next step is to call the procurement officer listed in the RFP and ask some basic questions about the last winning bid: what was the overall revenue from the contract, what did the winning company bid on the contract and are there any issues with this contract that you should be aware of? Once you know this information, make a pro/con list and decide if you would like to bid on the contract -- is the contract lucrative enough or within an area of desired expertise? Most importantly do not win a contract you can’t afford to win, it can put you out of business.

If you decide to complete the RFP remember who your audience is -- a procurement officer who purchases copy machines, paper cups and computer services. I have yet to meet a procurement officer who has ever attended an auction, so don’t assume they know how an auction works, write it out and explain the process. Provide complete information about your company - the more information the better, even if the RFP doesn’t ask for the information. Proposals should restate points in the RFP on a point by point basis.

When you do win the contract it is so important that you keep good records. Even if paperwork is not your high point, hire someone else to do the paperwork. The area of record keeping is what protects you in the event of a problem with your contract and the rule all government agencies live by is "the one with the most papers at the end of the day - wins".

I highly recommend that you make at least one attempt to win a government contract. Conducting government contractions means added visibility for your company and lends to your firm’s credibility. You will certainly attract new bidders to your auctions along with creating a dependable stream of income from regularly scheduled auctions.