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The Socio-Economic Blues...

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Thursday, November 30, 2006
Updated: Sunday, June 29, 2008

There's a major injustice that has been done and continues to occur, with regard to the expectations being set by elements of the federal contracting community. This injustice has to do with the socio-economic programs designated for federal contracting. In english, I'm referring to the 8(a) Business Development Program, Woman-Owned Small Business, Veteran and Service-Disabled Veteran Owned Businesses, HUBZone's and all of the rest.

The issue is that companies and the folks that run these companies are led to believe that these designations are cash-cows, requirements or both. Those that are here to sincerely run a business, do good business, make a living and more, are being led astray. Those that are the opportunists looking for the easy way to a fast buck, such as the "rent-a-socio-economic Owner/CEO" simply see a means to an opportunistic end, no matter the ramifications.

Too many people are concerned about becoming an 8(a) out of the gate and are not spending enough time on determining why they will be or are in business. It's the attempt to rejuvanate the 'beltway bandit" model that was prevalent in the eighties, that resulted in the stigma often associated with these programs. The Alaskan-Native program is the latest to fall victim, and who know's how long it will take for the Service-Disabled Veteran program to do the same. I talk to many Veterans out there who are service-disabled, but opt not to identify themselves through the CCR or otherwise, because they would rather let others who are more disabled leverage the benefit. I've also talked to Veterans who are not happy about other Vets who are "renting themselves out" so other companies can leverage the SDVOSB status.

 If you are starting a business in any sector, especially the federal sector, you need to get as much information as you can. You also need to consider the source of the information. The most important thing to consider is "Why is this business going to exist?". You need to consider what market you'll focus on and what issues or needs in specific market segments, can be potentially addressed by your product or service.

In federal contracting, there is a tremendous amount of public domain information available. It's not the lack of information that hurts you, it's understanding how to use it. Market research rules.

Once you decide on your offering, then determine how that product or service is being procured. As you are developing this information, you'll also learn about technical certifications and affiliations that you'll need, and potentially which small business designations (beyond Small Business) may be relevant if not helpful.

By the way, if someone tells you that you need to be a certified Small, Woman or Veteran-owned business. Tell them to stuff it.

There are only three programs that require formal certification for federal contracting. 

  1. 8(a) Business Development Program
  2. Small Disadvantaged Business Concern (SDB)
  3. Historically Underutilized Business Concern (HUBZone)

All others are self-certifying. Some large contractors and integrators leverage certifications issued by local and state governments and some associations, but make sure you understand what is needed and why before coughing up money for the thousands of certifications that exist.

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