Selling hardtech products as a non-prime aerospace company

Part 1: The general approach to sales

Non-prime aerospace companies primarily sell their products within the intricate multi-tiered aerospace supply chain. Instead of selling directly to the end-user (like airlines or military), these companies often become suppliers to Original Equipment Manufacturers (OEMs) or other tiers in the supply chain.  

Here's how they generally approach sales:

1. Targeting the right customers

• Understanding the supply chain: Non-prime companies position themselves to provide components, materials, or specialized services to Tier 1, Tier 2, or Tier 3 suppliers, and potentially even OEMs for very specific parts.

• Building Relationships: Establishing strong relationships with potential customers in different tiers is essential in the aerospace sector's long sales cycles.

• Identifying opportunities: Targeting opportunities before projects are fully defined and design choices are set is crucial. This proactive approach allows companies to showcase their unique value and potentially influence the design process. 

2. Demonstrating capabilities and expertise

• Highlighting specialization: Focusing on niche markets or specialized expertise can give smaller companies a competitive edge.

• Meeting quality standards: Adhering to stringent quality standards like AS9100 is crucial for participating in the aerospace supply chain.

• Showcasing innovation: Emphasizing innovation in products and processes is vital to attract partners and stand out from competitors.

• Attending trade shows and events: Industry events provide excellent opportunities to network, demonstrate products, and build rapport with potential buyers and partners. 

3. Utilizing effective marketing and sales strategies

• Digital Marketing: Leveraging online channels, such as targeted LinkedIn campaigns, industry publication advertising, and content marketing, can help non-prime companies reach decision-makers and showcase their capabilities effectively.

• Building a strong online presence: Creating compelling digital content like technical whitepapers and case studies can establish expertise and build brand recognition.

• Establishing a dedicated sales and marketing department: Having a team focused on B2B sales in the aerospace industry is important for guiding customers and addressing their specific needs. 

4. Partnering with others

• Forming strategic partnerships: Collaborating with other companies can provide access to new technologies, markets, and expertise.

• Becoming a certified supplier: Registering with relevant databases, like the U.S. government's System for Award Management (SAM) database, and completing supplier profile databases can expose companies to potential bid opportunities with the government and prime contractors. 

Non-prime aerospace companies succeed by understanding the intricate supply chain, focusing on their specialized capabilities, adopting effective marketing and sales strategies, and proactively seeking partnerships to deliver quality products and services within the aerospace ecosystem.

When Selling Directly to Government and Industry

• Some hardtech aerospace startups bypass the Tier 1 layer and directly sell their innovative solutions to government agencies or other industry players, especially when their products represent a complete system or a disruptive technology.

• Government agencies, like the U.S. Department of Defense or NASA, often seek partnerships and contract with startups for research and development (R&D) and procurement of advanced technologies.

• Examples of startups directly engaging with government and industry include:

  • Those offering services like satellite data analytics or orbital debris removal.

  • Companies developing specialized drone solutions for businesses and government agencies, like DroneUp.

  • Startups focusing on groundbreaking propulsion technologies or sustainable aviation solutions, such as Universal Hydrogen, who are working on hydrogen-based propulsion systems.

  • Companies involved in areas like AI-powered defense equipment or advanced materials. 

Hardtech aerospace startups strategically position themselves within the intricate aerospace ecosystem. They may choose to sell components or specialized technologies to major Tier 1 suppliers or directly engage with government entities and other industry customers for complete systems or solutions, often focusing on niche areas where their innovative products can have a significant impact.

Are you working in Aerospace and want to share your experiences of what works, what doesn’t, any recommended practices?

I focus on the hardtech side of deeptech and where revenue generation and capital formation overlap.

Reach out and say hello.

Thank you,

Mitchell