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Small Federal Contractors: Get Yourself PO'd and Like It!

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Sunday, October 20, 2013
Updated: Sunday, October 20, 2013

Albeit a shaky start, a new fiscal year has begun. The onset of new spending also brings new companies looking at Uncle Sam as a potential customer, and existing vendors beefing up and revising their strategies for generating business. Many companies, especially small federal contractors trying to expand their footprint into other agencies, will be looking for opportunities to prove themselves and get that first win.

Purchase orders can be one conduit for achieving that.

When an agency has a requirement, particularly something they need fast or something that is not part of a recurring purchase program acquired under a blanket purchase agreement or indefinite delivery contract, they often turn to purchase orders as the award instrument. To expedite the process, they may also employ Simplified Acquisition Procedures to streamline the procurement. This is the way most purchase orders are solicited, and represents less administrative burden for Government and Industry, and has inherent rules that favor contracting with small businesses.

But many on the industry-side of government contracting look at buys made this way as insignificant when compared to the tens and hundreds of billions spent on some established contract vehicles like the GSA Schedule, Governmentwide Acquisition Contracts (or GWACs) and the other types of indefinite delivery vehicles used by agencies. But if you are seeking to establish relationships and generate some revenue while waiting for an agency to award one of these mega-contracts, or are waiting for a task order to be released or a subcontract to get signed, making PO’s part of your strategy can help keep the lights on and also be a path to developing relationships  to gain access to the larger opportunities.

Since FY2009, government agency buys made using purchase orders represent just over three percent of the total fiscal spend reported in FPDS-NG each year.

The small business impact of purchase order spending for FY13 is just shy of $6B but that will increase once all of the DoD FY13 spending is reported on December 31st. And although $7.8B of the ten billion obligated to purchase orders in FY13 was issued without a small business set-aside, $3.5B of it went to small businesses. Add that to the $2.3B that was set-aside by agencies and you wind up with better than half of all PO buys were awarded to small businesses last fiscal year.

Even with the shutdown and the other budget related challenges to be faced as we move forward, purchase orders already account for $212M of government spending since October 1st. Remember, this number does not include any defense spending because of the ninety-day operational security delay in making DoD transaction information public. For the record, DoD obligated $4B to purchase orders in FY13, so far.

My internet radio program and the industry education and market intelligence seminars we host, both conducted under the banner of "Getting Your Company PO’d by Uncle Sam™as well as the government contracting spots I contribute to CBS Radio’s All News 99.1 WNEW are a great way to learn what agencies are buying, which agencies are buying and how much they are buying of what your company offers.

So while you're chasing whale opportunities, learn how to get yourself PO'd by Uncle Sam. You might like it!


The Chief Visionary

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

Tags:  Purchase Order  simplified acquisition  Small Business 

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