Sequestration forced revenue losses among almost two-thirds of contractors in 2013, according to a survey by two consulting firms released last week.
Almost 31 percent of the 220 firms that responded to the survey by Market Connections Inc. and Lohfeld Consulting Group Inc. said their revenue fell by more than 10 percent, while another 30 percent reported declines of nearly 10 percent.
In response to government market pressures, contractors are re-architecting by expanding into adjacent markets (45 percent), modifying lines of business (35 percent), and putting greater emphasis on the front-end of the life-cycle to improve capture strategies an
More contractors are pursuing new opportunities in state and local government, international markets, and energy in 2013 than in 2012. Pursuit of healthcare opportunities is still high on the list of new and adjacent markets contractors are pursuing:
- State and local government: 48 percent in 2013 vs. 29 percent in 2012
- Healthcare: 39 percent in 2013 vs. 38 percent in 2012
- International markets: 36 percent in 2013 vs. 29 percent in 2012
- Energy: 33 percent in 2013 vs. 20 percent in 2012
“It is clear that sequestration and the government shutdown have had a tremendous impact on the government contracting community,” said Lisa Dezzutti, president and CEO of Market Connections, Inc. “Contractors need to think outside the box, leverage their expertise in adjacent markets and focus on business development and capture strategies that will increase win rates.”
Contractors are making the following investments in the front-end of the lifecycle to enhance the business development and capture process and increase win probability:
- Improving capture and proposal processes: 40 percent
- Adding more business development/capture personnel: 39 percent
- Enhancing capture and proposal tools and infrastructure: 28 percent
- Increasing use of consulting services: 19 percent
- Adding more technical personnel to support business acquisition: 15 percent
- Adding personnel to write proposals: 12 percent
A full copy of the survey results can be downloaded at: http://www.marketconnectionsinc.com/index.php/Infographics/sequestrationgovernmentshutdowninfographics.html?Itemid=
