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As downturn dried up firms' commercial work, they turned their focus to getting government business
Posted on Tuesday, November 16, 2010

 

By Marjorie Censer

For 50 years, Lutron Electronics has specialized in home and commercial lighting systems, allowing individuals and companies to customize their lighting and easily control it. The company had dabbled in government business too, working with the White House and other government agencies.

But as the downturn in new building construction became increasingly serious and the government heightened its focus on energy savings, the company began thinking it should strategically focus on increasing its government business.

So in June, Lutron opened a 3,100-square-foot satellite office in Washington, an "experience center" where government officials can see demonstrations of how lighting could save them energy and money.

Andrew R. Wakefield, director of government relations for Coopersburg, Pa.-based Lutron, said the company had trouble convincing government officials to travel the several hours to its main office. But about 1,200 visitors -- many of them from government agencies such as the Army Corps of Engineers and the General Services Administration -- have already come to the D.C. facility.

And Lutron is already starting to reap the rewards, winning work in several Senate buildings.

"The federal market is clearly an extremely attractive market, and we see it growing faster than the commercial market right now," said Lauren Jones of Input, a research firm that focuses on the government contracting market. "It's not a quick hit market. It's a market that you invest in to grow your business."

When Michael Keough founded the Elkridge, Md.-based electronics destruction company E-Structors in 2003, he expected to primarily sell his services to the federal government.

But the company found limited awareness about the need to make sure computers and servers carrying client and patient data were securely and environmentally disposed of. Seeking to win over potential customers, E-Structors found that companies, rather than government agencies, were easier to sell, and the company soon built up a customer base.

But the economic downturn has meant that companies aren't refreshing their electronics as frequently, meaning a reduced volume of equipment that needs to be destroyed from any given customer. Consequently, E-Structors is refocusing on the government market, Keough said.

"The federal government does have resources and money to spend, where most corporations were cutting back or looking at alternatives," he said.

Late last year, E-Structors won a spot on a GSA procurement list, or schedule, a move Keough expects to yield significant contracts in the future.

Jones said companies that hope to increase their share of the federal market have to be patient.

"With the economy the way it is ... they're often finding that it is worth it," she said. "It just takes the right strategy."