In an uncertain economy, the federal government can be a
reliable source of revenues--often with good margins. To break into
the federal market, PR firms should look to win a spot on the
General Services Administration's (GSA) roster of approved
contractors.
Under its "Media, Marketing, and Public Information Services"
program, GSA maintains a stable of PR and marketing services
providers, ranging from small niche shops to some of the nation's
largest, full-service firms. Each of these firms has negotiated a
contract with GSA with a set of approved hourly rates, which
escalate over time, and a five-year initial period of performance,
with options for 15 more. Any federal agency can order services
from these firms, with no dollar limit on any individual project or
group of projects. The contracts cover a wide range of
services.
While federal agencies are free to use a wide variety of
acquisition methods, they are increasingly issuing task orders to
GSA contractors rather than developing their own RFPs, principally
because the GSA approach offers:
- Choice. Federal departments and agencies can choose from many
different PR and marketing firms. GSA does not insert itself into
this selection process. - Speed. Agencies can select a firm, issue a task order, and have
the firm begin work within a few weeks. This is a dramatic
reduction in the lead-time required to start projects compared to
other contracting mechanisms. (It is not uncommon for a federal
department to require a year or more to put a traditional contract
in place.) - Simplicity. Federal departments and agencies can skip many of
the tedious steps often involved in federal procurements, because
GSA already has satisfied key legal requirements-such as certifying
each PR firm's "price reasonable-ness" and meeting requirements
pertaining to minority and small business set-asides.
To obtain a spot on GSA's roster, PR firms have to respond to a
lengthy RFP. There is no time limit: Firms can submit their
proposals at any time, and if the proposal is complete in all
respects, GSA typically will award a contract within about four
months. Responding to the RFP can be difficult. While some sections
are relatively easy--for example, providing corporate
qualifications and describing the firm's basic approaches to
various types of PR services--others can be tricky.
For example, while GSA allows for commercial style billing
rates, responding to the pricing instructions should be done only
with expert advice. Strategic errors can have negative
repercussions for the subsequent contract. With the help of an
experienced consultant, most firms can prepare a proposal within
about four weeks.
After winning a contract award, a PR firm is free to market its
services to all federal agencies and departments. GSA contractors
have performed individual task orders ranging from $1,000 to $12
million. PR firms that qualify as "small" can have extra advantages
in seeking task orders, because all federal agencies try to meet
ambitious goals for awarding a certain amount of their contracting
dollars to firms that are small, or small and minority-owned.
PR firms have to shoulder certain administrative requirements
associated with their GSA contracts. For example, a firm must
report changes to its commercial hourly rates if they were relevant
to the prices it quoted to GSA in its original proposal. In
addition, each participating firm is required to periodically remit
an "Industrial Funding Fee" to GSA, equal to 1% of the firm's gross
sales under the contract. The good news is that GSA's contractors
can include the 1% markup on top of their approved rates. In other
words, the federal agency or department that orders services bears
the cost of the 1% tariff. Some firms also are required to make
good faith attempts to make subcontracting opportunities available
to small and disadvantaged vendors.
In sum, many PR firms are finding GSA contracts to be an
excellent source of revenues and profits, even in an era when
federal spending on PR is, at best, stagnant--primarily because
federal agencies are increasingly shifting their PR spending to GSA
contractors. Winning a GSA contract can be moderately difficult,
but any firm interested in providing PR services for federal
programs should at least consider taking this step.
Dave Alexander, of Lincoln Strategies, LLC (http://www.LincStrat.com), advises
leading professional services firms on matters related to the
federal government market. He is the aurthor of a book Guide to
Winning Federal Government Contracts (Natick, MA, 2002: ZweigWhite
Publishers, contact [email protected].)
An Impressive Roster, with Room for More
The following are a few of the PR firms that have won GSA Media,
Marketing, and Public Information Services (MMPIS) contracts.
Some are well-known, e.g.:
- The Ogilvy Group
- Young and Rubicam
- Fleishman-Hillard.
- J. Walter Thompson
- TMP Worldwide
But most are smaller players, e.g.:
- JR Reingold & Associates
- The Writer's Studio
- Betah Associates
- McKinney and Associates.