Navigating Government Procurement: A Conversation with Terry Nemeth

Terry Nemeth, an expert in public sector procurement, discusses the complexities of government contracting. From the importance of engaging early to the evolving landscape of procurement, Terry shares his insights and tips for businesses looking to work with government agencies.

Procurement has been in the spotlight recently, particularly in Ottawa. If you’re a company aiming to win business with the government, what are the three most important things to remember?

Before diving into specific tips, it’s crucial to understand the fundamental principle of public sector procurement. It’s supposed to be a fair and competitive process designed to provide value for taxpayer money. Following the rules is essential. When the government or companies don’t follow these rules, it can lead to serious trouble, as we’ve seen play out in the past year.

With that in mind, my three tips for companies unfamiliar with government procurement are: first, start early. And by “start early,” I don’t mean waiting for an RFI (Request for Information) or an RFP (Request for Proposal). I mean getting involved long before those stages. To understand what the government needs, you have to engage with the community—attend industry events, learn about the challenges the government is facing, and participate in discussions.

The second tip is to get involved in the RFI process and provide feedback on the best ways for the government to procure what they’re looking for. This involvement helps you understand the government’s needs better and allows you to build relationships.

Lastly, if your business involves more complex services or products, you should consider forming partnerships. Complex responses often require a consortium to meet all the requirements, so being open to collaboration is key.

But what about situations where government agencies may not fully understand their own needs or diagnose their problems accurately? Is it ever a good practice for companies to coach the government on what they might actually need?

Absolutely, and that ties into starting early. Agencies like Shared Services Canada or provincial procurement bodies often procure on behalf of many departments, each with unique needs. As a supplier, it’s fair game to help them articulate what business problem they’re trying to solve. Most procurement agencies are open to industry feedback. Engaging early means attending industry luncheons, listening to government officials discuss the issues they’re dealing with, and keeping up with trends. By doing this, you can position yourself as a helpful partner rather than just a vendor responding to an RFP.

You mentioned the various procurement websites governments use, which can sometimes be outdated or difficult to navigate. How can companies keep track of potential opportunities?

It depends on the product or service you offer. For straight commodities, websites like Buy and Sell Canada, MERX, and Supply Ontario are essential to monitor. If you’re large enough to have a dedicated bid response team, that’s their job—to watch those sites daily.

But, if you’re involved in a specific industry, you should already be aware of potential RFPs through your network. Waiting around for something interesting to pop up on a website is a flat-footed approach. By that time, you likely don’t have enough understanding of the government’s needs or the competitive landscape to put together a winning bid.

What common mistakes do companies make when bidding on government contracts?

One of the biggest issues is when multinational companies come to Canada expecting the same process they’re used to elsewhere. They often hire salespeople, open an office, and start canvassing for business without understanding the Canadian public procurement process. It’s a different landscape here. You need to be known and trusted before you win business.

Another common mistake is not thoroughly assessing their probability of winning. Companies often think their product is so good that it sells itself, but that’s not how government procurement works. It’s essential to evaluate your strengths, weaknesses, and the competition. This process involves determining if you need a partner or if it’s worth investing in the bid at all.

You also mentioned starting early to help shape the RFP process before it’s even drafted. Is that really possible?

Yes, it is, especially for large, complex deals. Smaller businesses often complain that bigger players “rig” the requirements to favor themselves, and there’s some truth to that. Large enterprises involved from day one influence the RFP so that only a select few can qualify, creating strict requirements like specific references or engineering capabilities that smaller firms can’t meet.

However, I also advise small businesses to consider partnering with larger enterprises. Big companies don’t want to do everything in the RFP themselves; they’re often looking for specialized partners. Understanding this dynamic is crucial—your competitor one day could be your partner the next.

What changes do you see on the horizon for government procurement, especially given its recent attention in the news?

There’s a lot of change coming, particularly around complex and large-scale government needs like digital transformation. We’re already seeing a move toward working with trusted partners within the G20 or NATO, especially for contracts with security implications. It’s going to become increasingly difficult for small businesses to qualify without forming partnerships.

Artificial Intelligence (AI) and quantum computing will also play a significant role. Quantum computing’s speed in processing vast amounts of data will enable governments to quickly generate requirements that meet the collective needs of multiple departments. This shift means that larger enterprises operating across allied nations will have an advantage, particularly at the federal level.

Any final thoughts or advice for companies navigating the government procurement process?