9 Industries Offering You Plentiful Growth Opportunities in 2020 Thanks to Very Strong Public-Sector Purchasing Activity

by Kevin Henderson

The U.S. economy in 2019 was robust—and by almost any measure one of the best of the last 50 years. For the federal treasury, that financial vigor translated into more tax revenues.

The estimated national tax haul in fiscal year 2019 was $3.44 trillion, up $111 billion from the previous fiscal year’s take. Economists working for the feds expect to raise another $200 billion during fiscal year 2020, bringing total U.S. government income through the end of this September to $3.64 trillion.

What does Washington plan to do with that windfall? Spend it, of course. On what? On purchases of practically anything and everything.

Patterns we’ve been seeing suggest that a substantial number of this shopping spree’s purchases orders will flow toward nine industries in particular.

We predict it’s among these nine that you’ll find the growth opportunities for your business to be most plentiful—and potentially the easiest to win if your competition for those contracts turns out to be thinly spread due to the sheer volume of purchasing requests.

Notably, it’s not just the federal government that will keep companies in these nine industries hopping throughout FY 2020. Many state and local governments too are flush with cash and keen to acquire goods, services, and solutions they’ve held off on buying when times were leaner.

Recognized government-purchasing expert Stephen Hetzel recently analyzed FY 2019 spending activity and from that assessment identified the nine industries he believes can look forward to being deluged with RFPs and bid opportunities during FY 2020 (watch him on video here).

The nine industries he predicts to benefit substantially from government spending are:

  • Information Technology
  • Cloud
  • Cybersecurity
  • Elections
  • 5G
  • Automation
  • Virtual Reality/Simulation
  • Education Technology
  • Renewable Energy/Wind Turbines

Let’s take a closer view of each of these nine industries and get the lay of the land.

Information Technology

The U.S. federal government in FY 2020 will remain the world’s Number One purchaser of information technology solutions. During this period, Washington is expected to spend nearly $90 billion on hardware and software solutions as well as for IT consulting services.

SAMPLE IT BIDS

State and local governments are projected to be similarly very active purchasers of IT in FY2020, adding billions of dollars to the expenditure tally. A big driver in this: agencies have been modernizing their IT infrastructure and systems; Hetzel said this trend will continue.

Cloud

As governments strive to bring their IT operations up to date, they’ll also significantly increase their spending on cloud solutions (look for the disappearance of on-premise data centers to intensify as a result). Hetzel is not alone in predicting that the federal embrace of cloud technology will grow by billions off dollars this year and on into the foreseeable future. Other observers are going farther, suggesting that federal use of the cloud will double over the next five years.

Of course, public-sector use of the cloud is not new—Washington first began exploring it 10 years ago in response to a burgeoning desire (true of the private sector as well) to make smarter use of resources, increase workflow and operational efficiencies, save money, and improve delivery of services to both internal and external customers.

Also, governments have been moving to the cloud to free their IT professionals to focus on endeavors other than the care and feeding of physical servers, network hardware, and storage devices.

Today, nearly all line items in the federal IT spending budget bear at least some connection to the cloud. However, as TechnoMile this past Sept. 4 wrote, the approach agencies take when moving to the cloud can vary widely:

“Earlier this year, the Federal CIO Council published an Application Rationalization Playbook intended to help agency IT program managers determine which applications to migrate to the cloud based on cost, functionality, governance and other concerns. Agencies are asking contractors they work with to follow this guidance. For more information read the Federal CIO Council's Application Realization Playbook."

SAMPLE CLOUD BIDS

Cybersecurity

With the ever-growing emphasis on cybersecurity, brace for agencies at all levels to ramp up their solicitations and purchases of antivirus/anti-malware, network and cloud security, data loss-prevention, intrusion-detection systems, and encryption-, identity-, and access-management solutions. Some of the funding for these purchases at the federal level should come from the $9.6 billion President Trump proposed in his FY 2020 budget for cybersecurity.

Industry analyst firm Frost & Sullivan estimated two years ago that government and military spending on cybersecurity for the following year would reach $13.84 billion, up by more than a third of a billion dollars from 2018’s $13.44 billion. It has. If that trend extends out to 2023, those same federal entities will be spending $16.01 billion to keep their online properties and data secure.

SAMPLE CYBERSECURITY BIDS

Elections

2020 is a big election year. At the national level, the office of the president again will be up for grabs. Ditto one-third of the 100 seats in the U.S. Senate plus all 435 seats in the House of Representatives. Add to those contests the thousands of others for offices high and low across the 50 states and their individual counties, cities, and special-purpose districts.

To run those elections requires a whole lot of equipment and supplies. Also, security.

Elections officials throughout the land are poised to invest millions of dollars over the coming months on voting booths, elections technology, and other support solutions. In the 2020 presidential election alone, Homeland Security and other agencies will be spending $425 million allocated by Congress to ensure the integrity of the vote.

Want to know more about what officials are eager to buy when it comes to safeguarding the franchise? Listen to elections security expert Chris Deluzio talk on this episode of “The Big Bid Theory”.

SAMPLE ELECTIONS BIDS

5G

Users of mobile devices want to be able to send and receive more data, and they want them to upload or download faster. This is true of people who don’t work for government, but it’s especially true of those who do.

That’s why—as Hetzel and Gartner Inc. both have noted—the federal government in 2020 can be counted on to help increase worldwide 5G wireless network infrastructure revenue by 89 percent to $4.2 billion over 2019 revenues of $2.2 billion.

One reason the feds (states and local governments too) are buying 5G products, services, and solutions like there’s no tomorrow is that the faster speed and greater data-carrying capacity permits high-definition and even ultra-high-definition video surveillance without the need for a wired telecommunications infrastructure, such as fiber optics.

Likewise, the speed and capacity of 5G makes it possible to improve agency workflow and increase responsiveness to constituents’ requests for information. In other words, 5G facilitates higher quality service and makes for greater happiness all around.

SAMPLE BROADBAND BIDS

Automation

As the discussion above about 5G makes plain, government agencies in 2020 are increasingly striving to improve efficiency and customer service while at the same time making their offices better places to work.

So, borrowing from lessons the private sector has learned, governments now are investing at a brisk pace in scalable process automation and artificial-intelligence technologies.

They’re doing this in order to reduce errors and waste. They’re doing this to elevate their brand. And they’re doing this to lower their operating costs (McKinsey estimates that as many as four out of five processes in governmental HR, finance, and application handling can be at least partially automated, yielding cost savings of a minimum 30 percent).

Ultimately, automation is seen by agencies as a solution to their need to become more agile in the face of economic shifts, changing administrations, and evolving public priorities.

SAMPLE AUTOMATION BIDS

Virtual Reality/Simulation

There are many ways a government agency can train its employees and impart knowledge to constituents. But few of those methods can match virtual reality and “sims” for effectively ingraining new skills. Besides, VR/sims technology is great fun to use (particularly true for people who are considered “visual” learners).

Governments lately have been catching on to the value or VR/sims for interactively conveying instructions. The trend shows no sign of letting up; thus, we expect to see bid/RFP activity for virtual reality and simulation solutions rise appreciably during FY 2020.

Our expectations are buttressed by the fact that, worldwide, spending on VR/sims will this year reach somewhere between $18.8 billion and $20 billion. Most of that spending will originate in the private sector, but the public sector’s share will be impressive nonetheless.

The fact is VR/sims solutions are becoming increasingly attractive to government entities thanks to technologic advancements and the steadily improving ability of vendors to help buyers better define uses for the immersive experiences these products make possible.

SAMPLE VIRTUAL REALITY BIDS

Education Technology

University of Kentucky education authority Dr. Justin Bathon says public schools and colleges need an array of technology-based teaching tools and administrative solutions to help them fulfill their mandate to produce the next generation of intelligent, well-rounded members of society.

(You can hear him go into depth about the importance of interactive tools, integration, computers, software-assisted instructional aids, online courses, and digitization by tuning into “The Big Bid Theory” podcast here, here, or here).

The number of K-12 schools and institutions of higher learning that are loading up on education technology (also referred to as “edtech”) is growing in tandem with teachers’ and professors’ desire to utilize approaches outside traditional methods of inculcation.

Increasingly, educators are discovering that edtech is a key to achieving success in the classroom and lecture hall. That helps explain why edtech spending at all levels of government rose to $1.5 billion in 2018, the most recent year for which figures are available.

EdSurge Inc.—an information clearinghouse for venture capitalists, teachers, school administrators, and others who want a sneak-peek at innovative instructional products, services, and solutions—confirmed at the end of 2018 that federal, state, and local government spending on edtech is healthy and getting healthier with each passing year.

SAMPLE EDUCATION TECHNOLOGY BIDS

Renewable Energy/Wind Turbines

The BidPrime database over the past year has detected strong growth in solicitations for solutions and services related to renewable energy, clean energy, wind turbines, and other alternatives to fossil fuels.

While true that investment tax credits for new solar systems and alternative energy production are shrinking, the boom in demand for eco-sustainability is unlikely to soon end.

Indeed, according to an October CNBC report quoting American Wind Energy Association (AWEA) CEO Tom Kiernan:

"Wind now supplies clean and efficient power to the equivalent of 32 million American homes, sustains 500 U.S. factories, and delivers more than one billion dollars a year in new revenue to rural communities and states."

The U.S. Department of Energy predicts that wind capacity in 2020 across 36 states will total 113.43 gigawatts--a gain of 52.31 gigawatts since 2013.

The DOE also forecasts wind capacity in 2030 across an even larger number of states—47—will rise an additional 110.66 gigawatts to 224.07 gigawatts.

An ongoing debate in the nation's capital asks whether the benefits of wind energy exceed the risks and costs. That debate may be settled by legislation such as H.R.3609 (introduced July 2). This bill would require the DOE to conduct a grant program to research, develop, and evaluate wind energy technologies and systems.

Even so, Hetzel said he was confident growth in this sector will continue unabated beyond 2020.

SAMPLE RENEWABLE ENERGY BIDS

Now is the time to get going

The American economy is behaving in ways that seem to herald the arrival of a new Roaring Twenties.

In the original Roaring Twenties one-hundred years ago, business was so good that it was almost as if every company and shop had its own private cash printing press.

It’s unclear how many enterprises will be that fortunate this time around. But there can be little doubt that the current boom is filling government coffers to overflowing. The evidence of that is the dramatic increase in RFPs and bid opportunities seen of late at all levels of government, especially when it comes to the nine industries we’ve been discussing.

Our advice to you is simply stake your claim and start mining the opportunities. Now is the time. BidPrime can help you get going.

For detailed Market Analyses of these nine red-hot, opportunity-rich industries, or for specific bid/RFP activity information within them, please visit BidPrime, call 888.808.5356, or email us at support@bidprime.com.