The federal government adapted to many challenges during the COVID-19 pandemic. At the same time, government contractors were dealing with their own set of challenges. Declining margins and watching nearly 70% of projects that were ahead of schedule, fall behind in 2020. (Nextgov June 7, 2021)
The hardest hit were small business contractors. Their profit margins dropped nearly 35%, with costs to bid on contracts rising exponentially. (ibid)
With all the changes in 2020, government contractors still remain optimistic that government contracting will increase into 2021 and 2022. Vendors trust that the changes to government operations will prove beneficial, in the long run. Especially with remote workforces expanding the available talent pool since companies will no longer be limited to specific geographic areas. (ibid)
A recent study showed contractors in the federal information technology sector expecting significant growth in 2021. Additionally professional services and aerospace and defense expect large gains as well as state, with local and higher education spending growing too. (ibid)
The study also shows industry is focused on exploring new ways to do business in a more virtual world. In-person meetings and events are still rare, forcing companies to seek new business opportunities from their existing client base. Fewer companies rely on public bid notices such as those found on SAM.gov or industry events or conferences. (ibid)
Companies must acclimate to doing business in a virtual world. Many may find, the best use of their resources is no longer face-to-face meetings. Working virtually may be the optimum use of their assets, going forward. (ibid)
Are you looking to benefit from the predicted growth trend? Give us a call.