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Why more 'Simplified' dollars don't make it to small business.

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Sunday, November 18, 2012

In a joint memo issued June 6, 2012, OFPP Administrator Jordan and SBA Administrator Mills cited "a third-party analysis of data in the Federal Procurement Data System suggests that a significant amount of work under the SAT is not going to small businesses, including for products and services in industries where small businesses are typically well represented."

They go on to say "This suggests that opportunities for small businesses are being lost, and that agencies must take additional steps to consistently apply set-asides in the manner prescribed in law and regulation."

My first thought when I read this memo back in June was to wonder if SBA or OFPP paid for that third-party analysis, and if so, was that opportunity one of those lost to small business?

Just sayin'.

So for the past few years, I've been doing my own analysis of the data in FPDS-NG related to purchasing under the Simplified Acquisition Procedures. My goal was and is to understand the ebbs and flows of spending that according to the Government saw $3 billion dollars more spent in FY12, than the total spending under these procedures during FY's 2000 through 2007.

Yes, that would be more dollars spent this way in a single completed fiscal year, than in eight completed fiscal years. And yes, I am trying to get your attention.

Here's why.

If you look at the number of offers received for SAP purchasing, it shows competition to be pretty low, generally speaking. Ordinarily, this would be good news for companies interested in these opportunities, except that when you dig into the numbers, you find out non-competed awards to "other than small businesses" represents a pretty significant portion of these buys. Some of these orders were placed under existing contracts or contract vehicles, where the competitive field was already small, or competition requirements had already been met.

While I'm pretty confident this falls within the realm of "good business" under the FAR, where does this help to maximize opportunities for small businesses?

In FY10, FY11 and FY12, over fifty percent of SAP dollars were awarded to "other than small businesses" for a multitude of goods and services small businesses can and currently do provide to the Government, economically and in compliance to agency requirements.

In one of my recent reports where the District of Columbia was the place of performance for nearly $1B in FY12 simplified acquisition spending, I calculated the average number of offers received to be fewer than two for each of more than 23K contract actions. Less than half of this was awarded to small business.

Since the overall spending number represents billions in government spending, I wonder what would happen to the small business goaling numbers if more or most of the SAP awards currently going to "other than small" companies were awarded to small businesses?


The Chief Visionary

"The person who says it cannot be done should not interrupt the person doing it."

Differentiate Yourself. Develop and Leverage Your Small Business C4ISR™.
(Capacity, Commitment, Core Competency, Intelligence, Strategy and Relationships)

Tags:  OFPP  SBA  simplified acquisition  small business 

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Comments on this post...

Jaime Gracia says...
Posted Friday, November 23, 2012
Granted there are no silver bullets, but if the government really wanted to achieve its goals, this is one area that can be easily fixed.

From what I continue to experience working with federal buyers, and especially in the classroom when I teach federal buyers, it is a matter of ignorance about the rules or the lack of desire stemming from the lack of accountability.

it is too easy to state "I don't have time," or "It is too difficult to find and qualify small businesses through market research." Large businesses have more BD resources, and proven past performance. So, give it to a large business. Why not?

There needs to be real accountability.
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