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An "Other than Small Business" in Small Business Clothing

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Friday, August 19, 2011
Small business dollars from federal contracts continue to benefit other than true small businesses, and it's legal (for now)!

So my friend Matthew Weigelt at FCW just issued another great piece of information (The ghosts of small businesses past) related to more small business program loopholes being exploited that ultimately harm companies actually deserving of the assistance provided by the U.S. Government.

What to do?

Since companies that are technically no longer small businesses are allowed to keep contracts originally set-aside for small businesses, how about applying the Small Business Subcontracting Program? Good ole' FAR Sub Part 19.7. It makes sense, right? Whether by organic growth or due to an acquisition, these companies are now considered "other than small business" which (generally speaking) means contracts with a value exceeding $650,000 are subject to this program. It's not punitive, it's a fact of life and a result of success.

Agencies should set the expectations from the start so when the time comes that the small business program has "worked" and a company is no longer eligible to receive assistance based on exceeding size standards, the natural progression is for these companies to take on subcontractors who are still small business concerns. It will be a nicer way for them to learn the ropes and transition their business model (on an existing contract where they are successful) as they prepare to play in a different league in future competitions. It also creates an opportunity for them to develop meaningful relationships with small business whom they will have a true working relationship with.

This, of course, doesn't begin to touch all of the challenges associated with enforcing subcontracting and ensuring primes pay their subs on time, or at all.

That's my ten cents for today!

- The Chief Visionary

The person who says it cannot be done should stop interrupting the person doing it.

Tags:  business  fcw  ghosts of small buinesses past  matthew  set-aside  small  subcontracting  weigelt 

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