Three Business Development Benchmarks for Government Contractors in 2021-22

Every year Deltek analyzes survey responses from hundreds of government contracting leaders on their previous year’s performance, compiling the results in Deltek’s annual GovCon Clarity survey. This year’s report, the 12^th annual in the series, helps contractors identify areas to improve operational efficiency and effectiveness, help set business goals and better understand how they stack up to their competitors in the market.

Business development professionals, in particular, can look at the trends from the study to inform their business development strategy and grow their government sales pipelines.

Government Contractors Expect Significant Growth in 2021-22

The biggest takeaway from this year’s survey is the positive attitude shared by most government contracting leaders. In total, 70% of those surveyed believe that government sales will increase in 2021.

Companies expect significant growth in the next 18 months, with particular emphasis on the professional services, aerospace and defense, healthcare, and architecture and engineering industries. State, local and education (SLED) markets are expected to benefit from the government stimulus programs that came from the Biden administration, and federal markets expect significant growth as well. Seventy-five percent (75%) of respondents look for IT business to either grow significantly or somewhat. On the whole, the outlook for every sector is positive one.

Lack of Resources a Top Challenge for Government Business Development

2020 brought business development professionals in the government contracting market a great deal of challenges, some new and some not. One challenge that businesses face regularly is a lack of BD resources and tools, resulting in difficulties responding to bids and RFPs. As resources continue to be limited, businesses should rethink how best to use their capabilities and people. For example, being able to leverage strong existing relationships and deep experience with the government contracting world will be even more important.

Other top challenges noted in this year’s survey were an increase in competition, difficulties creating opportunity pipeline forecasts and reports, and the implications of the COVID-19 pandemic on the market.

New Methods and Increased Business Development Investment are Expected

Increasingly, proactive government contractors are understanding that finding new ways to power their BD efforts is a crucial investment. Businesses are looking to continue this trend in 2021 with 57% of businesses expecting to increase investment in business development over the next 12 months. This was led by large businesses with 74% of those surveyed expecting to increase their investment.

One area this is expected to manifest is in virtual workforce and teaming environments. The pandemic forced companies to operate in new ways, creating new challenges for sourcing teaming partners and needing to do more with fewer resources – which is expected to lead to increased investment in better business development tools and systems.

Ready to go beyond the top-line trends and understand how to use this information to expand your business development efforts in government contracting? Download your copy of the BD excerpt from Deltek’s 12th Annual Clarity Government Contracting Industry Study to learn how business development professionals are approaching today’s government contracting environment.