Credit guru Thea Dudley has spent more than 30 years in LBM credit management. Now she’s here to answer your credit and collection questions. Got a question for her mailbag? Contact Thea at theadudley@charter.net
Dear Thea,
I was recently told by a customer they were going to “blow up” their credit line so they needed a large increase. That they would be doing a lot of federal and state work in disaster areas and that they were on the “priority list” with FEMA. I have never heard of this list and not sure where to find it. Can you help me?
Signed, Possibilities With Potential or Disaster
Dear Possibilities,
I love urban legends. The tales always grab my imagination and pull me in. I lose entire afternoons watching documentaries on them. One of my favorite tales is of The Lost Dutchman gold mine. It is a legend about a miner who found a great vein of gold somewhere in the Superstition Mountains in Arizona, then died leaving his treasure, and its location, behind. Countless dreamers have searched for the mine, some dying in the process, but no one has found it to this day. Does it really exist or is it just an urban legend, told and retold until it starts to sound so true, you become a believer? I don’t know if the legend is true, what I do know is people want to believe it is.
So it goes with the FEMA “priority list.” I want to believe there is a such a list. I’d like to know there are qualifiers that would make me, a lender, want to roll out the extended credit line and know that payment is backed by better-than-average potential. But alas, dear Possibilities, this is not even urban legend. It is simply not true.
There is no “priority list” with FEMA. Says so right on the website. What there is, and what may confuse people, is what FEMA calls a vendor profile form. The profile form is to place a company name (along with its products and services) to serve as “secondary market research resource.” (That was taken straight from the FEMA website so you can certainly see why that sounds like it says nothing.) Basically, it is a list where “secondary” markets can go to look at companies who are openly courting that work.
What is a secondary market? I didn’t know either. It is the secondary target audience you are trying to reach. The government may be your target but the companies its using may go here to look at what resources have raised their hands to want to be considered for these projects.
Submission of the form does not mean contractors are on a preferred vendor list. There is no such thing. It does not guarantee they will ever get a contract awarded to their company. It doesn’t guarantee them they will meet with FEMA representatives. They are letting others know they are out there and interested in doing work with FEMA.
There is no charge for submitting a vendor profile form. There are some companies out there that will tell contractors they can get them on a “list” and charge a fee to do it but they are really just doing what any company could do for itself at no charge. Think of it like those companies that tell you they can “fix” your personal or business credit and charge you a fee to do it when it is all stuff you can do yourself. There is no magic bean, just some reading and paperwork.
While your customer may believe they are on a list, and they may not have lied, they might just be believing in urban legend. Someone told them they could get your customer on a list, showed them some paperwork, and made them believe they struck gold. Unfortunately, it is rooted in some truth. They may be in fact on a list, just not as they believed. Ask them how they came to be on this “list.” Then be prepared to debunk the legend. Do it gently. No one likes feeling like they got played.
This is where you can get your credit manager super cape out and walk them through some things they can do for themselves to increase their chances for this type of work if they are interested. They can do it all themselves at no cost.
- Start with the Procurement Technical Assistance Center (PTAC)
- Register with SAM (System for Award Management). It is the official website for the Federal Government. Complete the disaster response information section. Registry is with both FEMA and the Army Corps of Engineers.
- Complete FEMA’s Industry Liaison Program Vendor Profile
This will at least give them a place to start. Other websites that they might be interested in:
- Federal Business Opportunities (Fedbizopps) (this is for opportunities over $25K)
- Department of Homeland Security (DHS) Advance Acquisition Planning System –
- Potential Subcontracting Opportunities with DHS prime contractors
If they are looking more towards state and local government projects, states with disaster issues usually set up a website. They can Google the “State of Louisiana” or the “Harris County,TX” or “City of Houston,” substituting whatever state, city or county they are looking for to see what the process and opportunities are.
Legends are powerful and convincing. Everyone wants to believe there is gold in “them thar hills” or, in our case, in them thar disasters. Educate your customers so they know the real deal from fool’s gold.
