Contents
- What is B2G?
- Who are the customers in the B2G market?
- Advantages and disadvantages of B2G
- How can companies enter the B2G market?
- Recommendations for newcomers in the B2G system
What is B2G?
B2G, or business-to-government, is a business model in which companies provide goods or services to government clients. This model is on par with other popular types of business, such as B2C (business to consumer) and B2B (business to business).
The primary tool in the B2G sector is procurement systems, which require that applications be published in open access, have transparent participation conditions, and comply with federal and local laws.
Who are the customers in the B2G market?
In the B2G market, customers can be various government structures, including:
- Educational institutions: schools, universities, kindergartens.
- Medical organizations: hospitals, clinics, sanatoriums.
- Law enforcement agencies: police, military, judicial authorities.
- State and municipal authorities.
- Scientific and cultural institutions: libraries, research centers, theaters.
Procurement can be organized at the municipal level for local institutions, as well as at the federal level for large government projects. Businesses can collaborate with the government in various ways: supplying equipment, offering services, or renting premises.
Advantages and disadvantages of B2G
Working with government institutions has its pros and cons. The main advantages include:
- Long-term contracts, which ensure stable income over a long period.
- The opportunity to establish a presence in the market, especially for startup companies.
- Large-scale purchases, allowing for operations with large volumes of products.
However, B2G also has its drawbacks:
- The tender system for selecting suppliers requires significant effort, including verification and preparation of documentation.
- The need to obtain quality certificates for certain types of services and goods.
- Long decision-making processes, which can lead to delays in payment.
In practice, the time to sign acts of completed work can exceed a month, creating risks for companies, especially for subcontractors.
How can companies enter the B2G market?
To become a participant in B2G, companies need to go through several steps:
- Register on the official public procurement website.
- Obtain an electronic signature for the manager.
- Prepare and submit the necessary documents for verification.
In Russia, there is a "Unified Information System in the Field of Procurement," where information about tenders and participants can be found. Small and medium-sized businesses can participate in tenders on federal electronic platforms, such as:
- The National Electronic Platform.
- The Unified Electronic Trading Platform.
- The Russian Auction House.
- RTS-Tender and others.
Recommendations for newcomers in the B2G system
For successful participation in tenders, newcomers are advised to:
- Start with small orders to learn the system and establish themselves as reliable contractors.
- Select tenders where personal interaction with the Customer is possible to make a good impression.
- Prepare thoroughly for each tender, backing their calculations with facts and monitoring the quality of supplies.
- Maintain contact with the Customer through clarifying letters and meetings.
- Withdraw from participation in a tender if the requirements are not met to avoid negative consequences.