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Three Ways To Make A Million...

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Monday, September 01, 2014
Updated: Monday, September 01, 2014

Three Ways To Make A Million...

If you are a small business and a federal contractor, that is. Since I worked for and owned small businesses when I sold to government agencies, and since 2004 have led one that supports them in the areas of information and relationships related to government contracting, I'm always interested in how federal dollars make their way to small companies. In the case of this article, I wanted to understand the best chances for small business concerns to realize at least one million dollars in awards from agencies based on three specific procurement methods which I will describe shortly.

Let me set the stage a bit. This is not so much a comparison as it is an attempt to highlight areas of opportunity small federal contractors should investigate further to understand how agencies tend to buy and how competition factors in based on what companies offer. In the end, information like this can help you develop a better understanding of how to position your company.

I decided to review spending for the current fiscal year which is just shy of $300B governmentwide as reported by agencies to the Federal Procurement Data System or FPDS-NG. This doesn't include obligations by agencies not required to report to FPDS-NG and also does not account for the ninety day delay in reporting by Department of Defense.

To achieve the result of a raw count of small businesses with at least $1M in FY14 dollars awarded to them, I considered FY14 competitive purchases by agencies awarded using Simplified Acquisitions Procedures, orders against both GSA and VA Schedules, and orders against GSA, NASA and NIH Governmentwide Acquisitions Contracts (GWAC). My results include awards where agencies indicated the company was a small business concern regardless of whether the buy was set-aside or not. I also extracted actual awards of new contracts or delivery/task orders as opposed to modifications. I do this to get a true look at contestable opportunities for the small federal contractor community at-large. Here's what I found:

When agencies looked to the GSA Schedules to make purchases this fiscal year (to-date) and indicated the companies receiving the obligations were small business concerns, I see 473 companies (based on Global DUNS Number) with total obligations of at least one million dollars for a total spend of $1.8B. There are twenty-nine companies with $10M or more and the small business concern with the most dollars clocks in at $87.5M in obligations against the GSA Schedule. For the record, the overall spend to small business concerns with $1M or more in dollars from the GSA Schedule is $4.3B which included non-competitive dollars and those obligated as a result of a modification.

Does your company have a GWAC like STARS II, SEWP or Alliant SB? This section is for you. Based on the criteria I referenced earlier, only 110 small businesses hit or crested the $1M mark accounting for just over $1B in obligations for FY14. The most dollars by one company was $81M and twenty-three small businesses exceeded $10M YTD. Adding in modifications and non-competitive dollars the total increases to $2B FY14 YTD.

This next one even surprised me.

When federal agencies leveraged the Simplified Acquisition Procedures to purchase products and services from small business concerns, nearly six-hundred companies (588 to be precise) hit or surpassed the million dollar mark for a total of $2.3B. One company tops the list with $517M in obligations FY14 YTD and thirty small businesses have exceeded $10M so far this fiscal year. When modification dollars (which accounts for far fewer 'Simplified' dollars than do GWAC and GSA Schedule buys) are added back in along with non-competed dollars, the total is $3B in obligations by agencies to small businesses receiving $1M or more in 'simplified' purchases this fiscal year.

NOTE: Since 'Simplified' buys can occur on Indefinite Delivery Vehicles (IDV) like BOAs, BPAs, GWACs and GSA Schedules, here is the adjusted amount when those buys are not included. $1.8B and 456 companies is the net when BOA spending ($4.2M), BPA spending ($285M) and Indefinite Delivery Contract (like IDIQs and MACs) spending ($142M) are not counted.

The fact Simplified Acquisitions account for more million dollar small businesses (via competitive buys) this year is a revelation especially when one considers FSS spending is normally twice the volume of buys made using Simplified Acquisitions. It's not really fair to include GWAC spending since it only represents Information Technology spending. Although, it would be interesting to look at IT spending across these three domains and run the same comparisons. Anyone interested in seeing that?

Like to learn how to position your company to be on one or all of these 'club' lists for FY2015? Click here to give me a call or email me at and I'll be happy to tell you about our membership, education and training programs for federal contractors.

Feel free to check out my other articles here.


The Chief Visionary

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

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