CONTRACT NEWS

How frenzied is your fourth quarter?

Contractors report increased pace of year-end business

The fiscal fourth quarter is guaranteed to be a busy time of year for contractors.

And, this year, the pace of business reported by several companies shows that fiscal 2012’s intensity is ahead of the highs from previous years.

“We’re seeing a surge in our business right now,” said Tom Mazich, Deltek executive vice president and general manager of GovCon. The company provides market research and program and project management software to government contractors. “It’s been happening essentially since fourth quarter last year,” he said.

Art Richer, president of the value-added reseller immixGroup, echoed Mazich’s findings. He said that his company is “expecting that it’s going to be busier this year than we’ve ever seen before.”

Terri Allen, executive vice president of sales at reseller DLT Solutions and Kim Nguyen, vice president of special programs at IT services provider Pragmatics, said the same.

So, to what specific demands within the market do these companies owe their busy quarters?

“On the large end of the market, we’re seeing that ‘change’ is really the continuing and driving theme,” Mazich said. “The larger contractors are all looking at things like optimizing the business: how do they reengineer their business processes, how do they redesign or reinvent their business, so that they can be more cost-effective so they can win more business."

In many cases, large businesses are looking at consolidation, he said. He sees a trend in businesses looking at heightening their project profitability. “There’s no more margin for error, and this is a result of the economic budget compression that’s in the marketplace, especially for the big guys,” Mazich said.

Efficiency and streamlining also is a theme contractors are hearing from their customers. “This year, we’re seeing more things in terms of consolidations of data center, cloud computing, mobile, cyber, those kinds of things,” Nguyen of Pragmatics said.

“The interest in cloud is much stronger than a year ago,” DLT’s Allen said. “Data Center consolidation solutions continue to be a key area our customers are acquiring solutions for.” She also noted an increase of lower price technically acceptable evaluations, a fact that was seconded by Nguyen.

Allen also said that another “key area of consolidation that is gaining more traction is enterprise license agreements. We see a keen interest from many of our customers in consolidating and co-terming their software agreements."

immixGroup similarly is seeing “more and more of those heavy enterprise deals in software and things like that, purchased at the end of the year,” Richer said.

Richer offered some specifics of how busy immixGroup gets during the last quarter of the year. “Four years ago, we did about 29 percent of our business in the fourth quarter. Last year, that rose to 37 percent, and we’re expecting, this year, that it could be as high as 40 percent of our business,” Richer said.

“We’re expecting that we’re going to do about 3,000 orders in September alone,” Richer said.

Allen said that DLT guarantees a one-hour quote, meaning that even aside from the actual business development and capture management processes, there’s a ton of demand to be met.

The companies said they have dedicated business development and capture management teams, who during these busy months have their nose to the grindstone, often working insane hours for the sake of their companies’ success.

Each of the companies stressed their preparedness, before the workload gets extremely heavy. Should they need to, Pragmatics said that they might tap “people that we’ve worked with in the past or people from other parts of the company that we pull in to meet this extra demand,” Nguyen said. ”But, in general, we have a very disciplined capture process.”

Pragmatics’ business development team is broken into three areas: business development, which is responsible for identifying opportunities; capture, which is responsible for qualifying and positioning Pragmatics to be the best bidder; and proposal, who work the schedule and develop a proposal once the request for proposal is released.

Those on the proposal team are the one who go through a cycle of doing very intense work, followed by a lull, then another intense period, followed by another period of activity, Nguyen said.

immixGroup’s team, as well, sees an intense period during the fourth quarter. “It’s effectively harvest time for our sales teams here,” Richer said. “We plan very carefully to make sure we are fully staffed,” he said. “It’s common that our sales people start their day very early in the morning and work late into the evenings, often times working weekends or past midnight,” Richer said.

As for taking care of his staff immixGroup will “bring in meals and snacks for our teams so that they don’t have to worry about how they’re going to be fed,” he said.

At DLT Solutions, too, Allen said that the company’s office has a system of bells that go off when the company gets news of contract awards. The goal is to keep morale high, she said.

immixGroup tries, as well, to inject some fun into the intense pressure of the fourth quarter. The company converts its training center, which spans 2,000 feet, into a themed lounge area during the day. This year, it is casino-themed, and employees can visit to play games with fake money, and can win prizes, such as having the vice president wash their car.

“It’s something just to help relieve the stress, to keep communication flowing,” Richer said. “And to make sure no one’s pulling their hair out.”

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