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Selling to Government

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General purchase behavior

y Competitive bidding (tenders) are oftenrequired to demonstrate the principle ofEqual Opportunity.

y Negotiated contracts are also possible,particularly in case of no competition to thevalue provider in question.

y

Political influences, national / regional bias& personal considerations are otherimportant factors in b2g selling.

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Role of government

y Specialized role of government and differentmotives like social, disaster relief,infrastructure development, defence,

education, political make b2g different fromb2b marketing considerations.y These factors often lead to non-standardized

products.y

This complexity and lack of standardizationare often the result of significant negotiationby a diverse group of stakeholders.

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Common Government Purchase Process

y Tenders Rate Contracts

y Tenders - Purchase Contracts

y Limited tenders

y Negotiated Contracts

y Most important - Through Government InstitutionalChannels

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Some major Government Customer segments

Ministries central & state

y Examples PMO, MHA, MOD, MEA,MOF, MHRD, MHE, MOR, MCA,

MUD,MOL, MYAy Characteristics

1. Huge staff

2. Lot of report generation

3. Lot of meetings & presentations4. Enough budgets

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Contd.

Central Government agenciesy R&D Centers NPL, CSIR, CRRI, CFTRI, FRI,

IPR, CMC, C-Dot, ISROy

NIC National Informatics Centrey Controlling & Monitoring Bodies AGCR, CVC,

CEC, Planning Commissiony Taxation Excise, Sales tax, Income Taxy Education IITs, IIMs, Universities, KVS,

Navodyay Vidhyalaya SangathanyApex Education Bodies NCERT, CBSE, AICTE,

UGC

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Contd.

Law enforcement agenciesy State Police Departmenty CBIy

RAWy Judiciary Courtsy CISFy NSGy

ATSy Paramilitary forces BSF, CRPF, ITBP, Coast

Guard

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Contd.

Utilities & Infrastructure Providers

y Municipal Corporations

y Electricity Boards

yWater Supply Departments

y CPWD & PWD

y NHAI, AAI, BRO

y Fire Control Departments

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PSUs

y Oil sector ONGC, IOC, HPCL, BPCL

y SAIL

y Power sector BHEL, NTPC, PFCL, PGCIL

y Banks SBI, RBI, PNB etc.

y Fertilizer sector NFL, IFFCO, KRIBHCO

y Defence Equipment BEL

y Telecommunication BSNL, MTNL, TCIL-VSNL

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Contd.

Transportation, Travel, Trading

y Indian Airlines, Air India

y Indian Railways Railway divisions, ICF, RCF,

DLWy DMRC

y Concor

y State Transport Corporations

y Shipping Corporation of India

y STC & MMTC

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PDS

Social Retail Services

y Commodities

y Kerosene

y Cooking Oil

y Candles, Matches

y Basic Health Medicines

y Family Planning Medicines

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Government sector-wise most commonprocedures

y Ministries KB, NCCF for all routinizeditems. Tenders for non-regular or specialrequirements like for new projects. Can also

ask NIC for IT related requirements.y Central government agencies KB, NCCF.

y Law enforcement agencies CBI, RAW

through KB, NCCF. State Police & otherdepartments float annual R/C for variuosproducts.

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Contd.

y Utilities Providers Generally have task-specificrequirements. Go for individual registration /limited tender method.

y

Defence Sector Mostly through the DefenceR

/Cof DGS&D for all routinized purchases. Newproduct suppliers have to be approved by DGQA

before they can apply for DGS&D registration.

y

PSUs More autonomous. Have full fledgedPurchase Departments. Go for empanelment /limited tender route.

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Contd.

y Paramilitary forces Can not buy through DGS&DDefence R/C. Can buy through DGS&D Civil R/Cor float open tenders.

y Railways & other non-military key establishments Can buy through DGS&D Civil R/C. Also go

through open tenders, registration + limitedtenders & local purchase routes.

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Contd.

y Banks Have their own procedures. Differentbanks give different purchasing powers to theirbranch managers within which he can havestraight negotiations, 3 quotations or buying from

any government channel.

y Educational Institutions Most have them havedecentralized system with the HOD having

authority for his departments routine purchases.Anything beyond that has to be routed through theCentral Administration department.

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