How to sell to the government: the GUIDE to help your company!
Posted: Sun Dec 22, 2024 4:48 am
If you want to sell to the government, you need to understand a few things first, such as what a bidding process is, how to participate in one, and make sure that you and your company are qualified to carry out this task.
That’s why the Public Procurement Portal has created a guide to help you sell to the government. Read all about it below. Enjoy your reading!
Register on the Public Procurement Portal and start selling to the government!
How does the government procurement process work?
In recent decades, Brazil has improved its management procedures at all levels, establishing objective rules and streamlining procedures both to make things faster and to offer greater transparency to public accounts.
This is a way of prioritizing free competition and the quality of products and services offered by private companies to the government.
Therefore, works, purchases, sales and services of the Public, Legislative and Judicial Authorities are only contracted through the bidding process, which seeks to guarantee equal conditions for all competitors.
Both in the old bidding law and in the new bidding law, it is prohibited to establish different treatment between Brazilian and foreign companies in the bidding process, for example, with the exception of the purchase of IT goods and services.
If you are a businessman who wants to sell to the government, it is very important to understand how the bidding processes work, so that you can participate in them with a chance of being the winner and obtaining a contract with the public administration.
Each bidding process has its own notice, however, they are similar to each other.
Who can sell to the government?
who can sell to the government
In general terms, any company or person can sell to the government, as long as it is properly formalized.
To participate, the company must have all the required legal documents in order, and is then eligible to participate in a bidding process.
However, there are some figures that cannot sell to the government for contextual reasons. Understand:
The author of the basic or executive project, whether an individual or legal entity, cannot participate in the bidding process;
Likewise, the company, alone or in a consortium, responsible for preparing a basic or executive project of which the author of the project is a director, manager, shareholder or holder of more than 5% of the capital with voting rights, or controller, responsible, technician or subcontractor may also not;
Furthermore, the employee or director of the contracting body or entity or person responsible for the bidding process cannot sell to the government.
It is worth remembering: any and all technical, commercial, economic, financial or labor-related links between the author of the project, an individual or legal entity, and the bidder responsible for the services, supplies and works, including members of the bidding committee, are considered “indirect participation”.
The author of the project is permitted to participate in the bidding process for works or services, or in the execution, only as a consultant or technician, provided that this is in the role of inspection, supervision or management and, exclusively, in the service of the Administration.
Advantages of selling to the government
advantages of selling to the government
Learning how to sell to the government is a great way to open up a variety of opportunities, as there are several advantages to participating in bidding processes. Check out the main ones:
1. Selling to the government is easy
Selling to the government is not as difficult as it seems. In fact, apart from the legal process involved, selling to the government will actually cost less time and resources than selling to regular customers.
Anyone who has a company knows that each client has a specific demand, it can take hours and hours to negotiate, in addition to all the effort involved in marketing.
Now, when we are talking about selling to the government, things get simpler.
First of all, you won't have to spend money on marketing. A government agency interested in your services won't come to your company because they saw an ad or something like that.
In fact, when we are talking about selling to the government, the process is exactly the opposite: the public administration announces the intention to purchase and you go to them.
Furthermore, when selling to the government, you do not need to train employees to be able to persuade the customer, because when you win a bid, you will not have to deal with arguments of this nature.
The public agency will make its requirements, price expectations and selection criteria very clear to the public from the beginning. Just read the notices carefully.
In other words, the government is like a customer who enters your store already knowing exactly what product he wants to buy and how much he is willing to pay.
Once you learn how to deal with the procedural flow that involves the entire public procurement process, it will no longer be an impediment and it will be much easier to participate in bids and emerge as the winner.
2. The government is a good payer
Contrary to what many people believe, the Brazilian government is a good payer, as it is required by law to pay thanks to the Fiscal Responsibility Law.
Most bids are paid quickly, within 30 days after delivery of the product or service. Of course, there is the possibility of this deadline being extended for another 90 days, but this is all provided for by law.
The Fiscal Responsibility Law helps reduce the chance of default by the government, forcing it to pay.
Furthermore, the fact that Public Administration is governed by laws, rules and fixed procedures makes it easier to monitor, charge and demand payment in cases of delay. In other words, it is more secure than a private client.
The risk of government default is equivalent to the risk of the private sector. However, in some cases, payment of overdue debt is more assertive with public bodies.
3. Anyone can participate and the process is fair and transparent
As we saw previously, any company or person with up-to-date documentation can participate in bidding processes and sell to the government.
Furthermore, the entire bidding process for purchasing a good or contracting a service via electronic auction is carried out to ensure equal opportunities for all companies.
Since, in most cases, the criterion that defines the winner of a bid is price, this mobile phone number database ensures equality in the process. And since it is public, if you do not win, you will be able to know exactly why the bid went to another company.
Tips on how to sell to the government
tips on how to sell to the government
As we have seen throughout the text, selling to the government is not difficult. You just need to be aware of how the bidding processes work and sign up.
However, there are still some tips that you can apply when trying to sell to the government that will make your life easier. Check them out:
Evaluate the amount paid by the government in similar tenders
A valuable tip is to keep an eye out for other bidding processes that result in the purchase of a product or service similar or competing with yours.
Knowing how much the government has already paid other companies to provide the same service makes it easier to set a price that is competitive.
Assess whether there is demand for your product/service
There is no point in offering a product or service to the government if the government has no intention or need to buy your product or service.
Therefore, assess whether there is demand within the government for the product or service you offer.
Evaluate payment terms
Don't go and sell to the government thinking that you will receive payment the next day and that all your bills are paid.
To sell to the government, it is necessary to have your accounts up to date, because, as we have seen, even with the Fiscal Responsibility Law, payment can only be made 30 days or more after the delivery of the product or service.
Therefore, assess whether the government's payment deadlines are within your budget to avoid headaches.
How to sell to the government: get your tax status in order
One of the things you should keep in mind before selling to the government is that you must keep your company's accounts up to date, as well as registering with the Unified Supplier Registration System, SICAF, or other regional registration systems.
This makes it easier to verify the regularity of your organization at the time of bidding, since these documents are required in most notices. Therefore, keep up to date with your tax obligations.
Pay attention to the Bidding Notices
Pay attention to the Official Gazette of the Union, states and municipalities, as well as government procurement websites where bidding notices are published.
Ideally, you should always be up to date so as not to miss deadlines and be able to prepare well to participate in the bidding processes that interest you.
If you wish, you can register for free on the Public Procurement Portal's Bidding Alert .
This way, you will always be kept informed about the latest tenders and will not miss any opportunity to provide services to the government! And without having to pay anything for it!
Have technology on your side
You can also use software to check some valuable information to increase your chances of winning the bidding process.
In applications like this, you can find out information about your competitors, such as who their partners are, the products and services they offer, and the bids they have already won.
In addition, it is possible to know which public bodies buy your products, the region of the country that has the most orders, the average price of bids for your product and the quantity already purchased.
Look for partnerships
seek partnership such as selling to the government
This tip is very useful for situations in which you find a tender in which you consider yourself eligible to participate, but you cannot meet all the requirements.
According to the General Law, large companies that obtain large contracts can subcontract up to 30% of the services to small companies.
In other words, if you are a large company, you can find partnerships to help you fulfill the contract and, if you are a small company, you can look for large companies to offer your services for up to 30% of the services purchased in the bidding process.
Don't go beyond your limits
Do not offer lower prices than the actual cost of the product or service just to win a bid, much less promise to deliver more than your company is capable of producing.
If you are unable to comply with the agreement, you may be subject to penalties for breach of contract.
Therefore, be aware of the limits of your business. Don’t make promises you can’t keep, whether in financial or material terms.
Have working capital
This tip is all about paying attention to deadlines. As we have seen, the government does not always pay for the service or product immediately after delivery - this period can extend up to 30 days - so having working capital is important.
In addition to financing production, these financial reserves are important to ensure that the company will not be in the red if the government delays payment.
How to Sell to the Government: Be Creative and Innovative
When we are talking about being creative and innovative, we are talking about offering exclusive services and products, that is, that only you can offer.
In most bidding processes, competition is fierce, which means prices are quite similar. However, if you have a differentiated product or service, this won't be a problem.
If, on the one hand, you are unable to compete with major market players when it comes to price and scale, on the other hand, you can beat all the competition by offering a unique and innovative product or service.
Find out how your competitors are selling their product/service
Knowing how your competitors are selling their products or services is very important so that you have an idea of how to better position yourself in the market.
Through this type of analysis, you will know if you can offer a better price and, therefore, win the bidding process.
Access the Public Procurement Portal!
How do I find open bids for my business?
how to find bids to sell to the government
The public sector is, without a doubt, one of the largest consumers of goods and services in all of Brazil. In 2020 alone, according to the Transparency Portal budget , the government spent around R$4.1 trillion on goods and services.
You can check which agencies and entities have an open bidding process through the Public Procurement Portal itself or on the portals of the public agencies to which you intend to sell.
How do I sell to the government as a MEI?
You can sell to the government as an MEI through the Public Procurement Portal. To participate in these tenders, you only need to follow a few simple steps.
First, go to the Public Procurement Portal home page and click on the “Register” button.
Then click on “Provider”. On the page, you must choose between one of the four available plans, which you can check by clicking here .
With the free plan, you will have access to the Tender Notice. You pay absolutely nothing and receive notices about tenders in your region three times a week.
Under this plan, you will still not be able to participate in electronic bids or auctions, only electronic waivers, if applicable.
However, with other plans, it is possible to participate in unlimited bids throughout the entire period of contracting the service.
You can also check right now if there are bidding opportunities for your company on our Bidding Processes page !
What are you waiting for? Check out the opportunities available for your company right now and start calculating how much you can earn by selling to the government!
What are the best-selling products in bidding?
The items purchased by the government through tenders vary greatly, from pharmacological and medical supplies to underwear.
Many people don't think much about it, but everything that the government uses and everything that it gives to someone has gone through a bidding process.
Literally almost all products can be purchased by the government, from uniforms and equipment or mattresses and basic food baskets distributed in an emergency to vaccines and supplies for the production of medicines or office supplies.
Common goods items are those most frequently auctioned by the government, such as: teaching materials, office supplies, cleaning supplies, medicines, medical supplies, building and fleet maintenance, etc.
How to Sell to the Government: Conclusion
As we have seen throughout the text, selling to the government is not a very difficult or complicated task. In fact, as long as you have all the information up to date, selling to the government can be very advantageous, especially due to the lower risk of default.
However, you need to be aware of some factors, such as payment deadlines, bidding notices and have a good idea of your own limits, as you don't want to offer more than you can deliver, do you?
You also need to be aware of your company's working capital, because, despite the Fiscal Responsibility Law, Complementary Law No. 101 , the government can take up to 30 days after delivery of the product or service to make the payment.
Therefore, it is important that, in addition to analyzing competitors' prices, you have your company on its feet, so that a possible delay in payment does not interfere with your company's cash flow.
That’s why the Public Procurement Portal has created a guide to help you sell to the government. Read all about it below. Enjoy your reading!
Register on the Public Procurement Portal and start selling to the government!
How does the government procurement process work?
In recent decades, Brazil has improved its management procedures at all levels, establishing objective rules and streamlining procedures both to make things faster and to offer greater transparency to public accounts.
This is a way of prioritizing free competition and the quality of products and services offered by private companies to the government.
Therefore, works, purchases, sales and services of the Public, Legislative and Judicial Authorities are only contracted through the bidding process, which seeks to guarantee equal conditions for all competitors.
Both in the old bidding law and in the new bidding law, it is prohibited to establish different treatment between Brazilian and foreign companies in the bidding process, for example, with the exception of the purchase of IT goods and services.
If you are a businessman who wants to sell to the government, it is very important to understand how the bidding processes work, so that you can participate in them with a chance of being the winner and obtaining a contract with the public administration.
Each bidding process has its own notice, however, they are similar to each other.
Who can sell to the government?
who can sell to the government
In general terms, any company or person can sell to the government, as long as it is properly formalized.
To participate, the company must have all the required legal documents in order, and is then eligible to participate in a bidding process.
However, there are some figures that cannot sell to the government for contextual reasons. Understand:
The author of the basic or executive project, whether an individual or legal entity, cannot participate in the bidding process;
Likewise, the company, alone or in a consortium, responsible for preparing a basic or executive project of which the author of the project is a director, manager, shareholder or holder of more than 5% of the capital with voting rights, or controller, responsible, technician or subcontractor may also not;
Furthermore, the employee or director of the contracting body or entity or person responsible for the bidding process cannot sell to the government.
It is worth remembering: any and all technical, commercial, economic, financial or labor-related links between the author of the project, an individual or legal entity, and the bidder responsible for the services, supplies and works, including members of the bidding committee, are considered “indirect participation”.
The author of the project is permitted to participate in the bidding process for works or services, or in the execution, only as a consultant or technician, provided that this is in the role of inspection, supervision or management and, exclusively, in the service of the Administration.
Advantages of selling to the government
advantages of selling to the government
Learning how to sell to the government is a great way to open up a variety of opportunities, as there are several advantages to participating in bidding processes. Check out the main ones:
1. Selling to the government is easy
Selling to the government is not as difficult as it seems. In fact, apart from the legal process involved, selling to the government will actually cost less time and resources than selling to regular customers.
Anyone who has a company knows that each client has a specific demand, it can take hours and hours to negotiate, in addition to all the effort involved in marketing.
Now, when we are talking about selling to the government, things get simpler.
First of all, you won't have to spend money on marketing. A government agency interested in your services won't come to your company because they saw an ad or something like that.
In fact, when we are talking about selling to the government, the process is exactly the opposite: the public administration announces the intention to purchase and you go to them.
Furthermore, when selling to the government, you do not need to train employees to be able to persuade the customer, because when you win a bid, you will not have to deal with arguments of this nature.
The public agency will make its requirements, price expectations and selection criteria very clear to the public from the beginning. Just read the notices carefully.
In other words, the government is like a customer who enters your store already knowing exactly what product he wants to buy and how much he is willing to pay.
Once you learn how to deal with the procedural flow that involves the entire public procurement process, it will no longer be an impediment and it will be much easier to participate in bids and emerge as the winner.
2. The government is a good payer
Contrary to what many people believe, the Brazilian government is a good payer, as it is required by law to pay thanks to the Fiscal Responsibility Law.
Most bids are paid quickly, within 30 days after delivery of the product or service. Of course, there is the possibility of this deadline being extended for another 90 days, but this is all provided for by law.
The Fiscal Responsibility Law helps reduce the chance of default by the government, forcing it to pay.
Furthermore, the fact that Public Administration is governed by laws, rules and fixed procedures makes it easier to monitor, charge and demand payment in cases of delay. In other words, it is more secure than a private client.
The risk of government default is equivalent to the risk of the private sector. However, in some cases, payment of overdue debt is more assertive with public bodies.
3. Anyone can participate and the process is fair and transparent
As we saw previously, any company or person with up-to-date documentation can participate in bidding processes and sell to the government.
Furthermore, the entire bidding process for purchasing a good or contracting a service via electronic auction is carried out to ensure equal opportunities for all companies.
Since, in most cases, the criterion that defines the winner of a bid is price, this mobile phone number database ensures equality in the process. And since it is public, if you do not win, you will be able to know exactly why the bid went to another company.
Tips on how to sell to the government
tips on how to sell to the government
As we have seen throughout the text, selling to the government is not difficult. You just need to be aware of how the bidding processes work and sign up.
However, there are still some tips that you can apply when trying to sell to the government that will make your life easier. Check them out:
Evaluate the amount paid by the government in similar tenders
A valuable tip is to keep an eye out for other bidding processes that result in the purchase of a product or service similar or competing with yours.
Knowing how much the government has already paid other companies to provide the same service makes it easier to set a price that is competitive.
Assess whether there is demand for your product/service
There is no point in offering a product or service to the government if the government has no intention or need to buy your product or service.
Therefore, assess whether there is demand within the government for the product or service you offer.
Evaluate payment terms
Don't go and sell to the government thinking that you will receive payment the next day and that all your bills are paid.
To sell to the government, it is necessary to have your accounts up to date, because, as we have seen, even with the Fiscal Responsibility Law, payment can only be made 30 days or more after the delivery of the product or service.
Therefore, assess whether the government's payment deadlines are within your budget to avoid headaches.
How to sell to the government: get your tax status in order
One of the things you should keep in mind before selling to the government is that you must keep your company's accounts up to date, as well as registering with the Unified Supplier Registration System, SICAF, or other regional registration systems.
This makes it easier to verify the regularity of your organization at the time of bidding, since these documents are required in most notices. Therefore, keep up to date with your tax obligations.
Pay attention to the Bidding Notices
Pay attention to the Official Gazette of the Union, states and municipalities, as well as government procurement websites where bidding notices are published.
Ideally, you should always be up to date so as not to miss deadlines and be able to prepare well to participate in the bidding processes that interest you.
If you wish, you can register for free on the Public Procurement Portal's Bidding Alert .
This way, you will always be kept informed about the latest tenders and will not miss any opportunity to provide services to the government! And without having to pay anything for it!
Have technology on your side
You can also use software to check some valuable information to increase your chances of winning the bidding process.
In applications like this, you can find out information about your competitors, such as who their partners are, the products and services they offer, and the bids they have already won.
In addition, it is possible to know which public bodies buy your products, the region of the country that has the most orders, the average price of bids for your product and the quantity already purchased.
Look for partnerships
seek partnership such as selling to the government
This tip is very useful for situations in which you find a tender in which you consider yourself eligible to participate, but you cannot meet all the requirements.
According to the General Law, large companies that obtain large contracts can subcontract up to 30% of the services to small companies.
In other words, if you are a large company, you can find partnerships to help you fulfill the contract and, if you are a small company, you can look for large companies to offer your services for up to 30% of the services purchased in the bidding process.
Don't go beyond your limits
Do not offer lower prices than the actual cost of the product or service just to win a bid, much less promise to deliver more than your company is capable of producing.
If you are unable to comply with the agreement, you may be subject to penalties for breach of contract.
Therefore, be aware of the limits of your business. Don’t make promises you can’t keep, whether in financial or material terms.
Have working capital
This tip is all about paying attention to deadlines. As we have seen, the government does not always pay for the service or product immediately after delivery - this period can extend up to 30 days - so having working capital is important.
In addition to financing production, these financial reserves are important to ensure that the company will not be in the red if the government delays payment.
How to Sell to the Government: Be Creative and Innovative
When we are talking about being creative and innovative, we are talking about offering exclusive services and products, that is, that only you can offer.
In most bidding processes, competition is fierce, which means prices are quite similar. However, if you have a differentiated product or service, this won't be a problem.
If, on the one hand, you are unable to compete with major market players when it comes to price and scale, on the other hand, you can beat all the competition by offering a unique and innovative product or service.
Find out how your competitors are selling their product/service
Knowing how your competitors are selling their products or services is very important so that you have an idea of how to better position yourself in the market.
Through this type of analysis, you will know if you can offer a better price and, therefore, win the bidding process.
Access the Public Procurement Portal!
How do I find open bids for my business?
how to find bids to sell to the government
The public sector is, without a doubt, one of the largest consumers of goods and services in all of Brazil. In 2020 alone, according to the Transparency Portal budget , the government spent around R$4.1 trillion on goods and services.
You can check which agencies and entities have an open bidding process through the Public Procurement Portal itself or on the portals of the public agencies to which you intend to sell.
How do I sell to the government as a MEI?
You can sell to the government as an MEI through the Public Procurement Portal. To participate in these tenders, you only need to follow a few simple steps.
First, go to the Public Procurement Portal home page and click on the “Register” button.
Then click on “Provider”. On the page, you must choose between one of the four available plans, which you can check by clicking here .
With the free plan, you will have access to the Tender Notice. You pay absolutely nothing and receive notices about tenders in your region three times a week.
Under this plan, you will still not be able to participate in electronic bids or auctions, only electronic waivers, if applicable.
However, with other plans, it is possible to participate in unlimited bids throughout the entire period of contracting the service.
You can also check right now if there are bidding opportunities for your company on our Bidding Processes page !
What are you waiting for? Check out the opportunities available for your company right now and start calculating how much you can earn by selling to the government!
What are the best-selling products in bidding?
The items purchased by the government through tenders vary greatly, from pharmacological and medical supplies to underwear.
Many people don't think much about it, but everything that the government uses and everything that it gives to someone has gone through a bidding process.
Literally almost all products can be purchased by the government, from uniforms and equipment or mattresses and basic food baskets distributed in an emergency to vaccines and supplies for the production of medicines or office supplies.
Common goods items are those most frequently auctioned by the government, such as: teaching materials, office supplies, cleaning supplies, medicines, medical supplies, building and fleet maintenance, etc.
How to Sell to the Government: Conclusion
As we have seen throughout the text, selling to the government is not a very difficult or complicated task. In fact, as long as you have all the information up to date, selling to the government can be very advantageous, especially due to the lower risk of default.
However, you need to be aware of some factors, such as payment deadlines, bidding notices and have a good idea of your own limits, as you don't want to offer more than you can deliver, do you?
You also need to be aware of your company's working capital, because, despite the Fiscal Responsibility Law, Complementary Law No. 101 , the government can take up to 30 days after delivery of the product or service to make the payment.
Therefore, it is important that, in addition to analyzing competitors' prices, you have your company on its feet, so that a possible delay in payment does not interfere with your company's cash flow.