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Even Work Meant for Small Business is Elusive.

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Sunday, November 02, 2014
Updated: Sunday, November 02, 2014

Even Work Meant for Small Business is Elusive.

For FY2014, sixty-one federal agencies have reported $15.5 billion in Simplified Acquisition Procedure obligations to the Federal Procurement Data System, so far. When you consider Department of Defense obligations that are not currently viewable to the public, the YTD number is $19 billion which represents a two billion dollar increase over FY13 obligations.

Of the dollars reported to FPDS-NG that are public, $13.2 billion was obligated to 6,850 entities who each received at least $250,000 in 'simplified' dollars during FY14. As also reported by agencies, five thousand small business concerns captured $7 billion of these streamlined purchase obligations when they too had at least $250,000 in obligations via Simplified Acquisitions.

How significant of an impact would there be if three to five billion additional dollars was awarded to small federal contractors in a given fiscal year? How many jobs could be created if five thousand additional American small businesses received $1 million dollars each in FY2015? What if it were ten thousand small businesses receiving $500,000 in business from federal agencies? It could happen very easily.

Purchases by federal agencies under the Simplified Acquisition Procedures (FAR Part 13) have an inherent preference for small business contracting. The Federal Acquisition Regulations cite these buys as reserved exclusively for small business concerns (when the amount is within the Simplified Acquisition Threshold) yet it seems many small federal contractors ignore what could be tremendous opportunities for growth and sustainment. Routinely small business captures as many of these dollars without set-aside as they do with set-aside. For FY14 this is represented by the nearly $9 billion awarded to small business with just over $4 billion of it set-aside

Which is why it's so puzzling that nearly $5 billion of the total simplified spend during FY14 was competitively awarded to 'other than small businesses.' I'm good with the two billion in non-competitive awards to large companies, after all, the agency took the time to write a J&A, right? But the other five billion doesn't make sense. Even if agencies didn't expect to receive two or more offers from small businesses competitive in terms of price, quality and delivery so they could set-aside the opportunity, we can still go toe-to-toe with whomever shows up, right?

But I don't believe for a second there are not two or more small business concerns who can provide:

  • Card Reader Access Control System
  • Repairs to a Bulldozer
  • Disposal of Two Armored Vans in Finland
  • Herbicide Treatment
  • Cleaning Supplies/Daily Janitorial Service
  • Cleaning Supplies for Embassy - Commissary
  • 60 EA Unlocked Q10 Blackberry Devices
  • Printer Toner for MFPS
  • Dumpster Rental and Services
  • Interpretation Service
  • Car and Driver from 26 March to 4 May
  • Canopies for US Embassy N,Djamena Vehicles
  • Drapery Installation
  • Install Terminate and Tag for 30 CAT 6 Single Voice Jack Locations
  • Exclusive Use of Helicopter Services for BLM
  • Clothing for the Inmate Population
  • Translation/Interpretation Service
  • Postage Machines Statewide
  • Maintenance Support for UPS Units
  • Language Training Services
  • Survival Japanese Course for Newcomers
  • Upholstery of Furniture
  • Parenting Program Services at USP Lewisburg, PA
  • Inspect Faulty Transformer
  • Brother Intellifax 4100E Laser Plain-Paper Fax
  • Rescue Swimmer Drysuits
  • Medical Technicians
  • 12 Passenger Van
  • Jewish Rabbi Services for FY2014
  • Provide Transitional Drug Abuse Treatment (TDAT) and mental Health Services to Offenders

This is a small sample of the nearly thirty-thousand descriptions of competitive Simplified buys (and modifications) made to large companies during FY2014.

The majority of these dollars, $3.3B, had a place of performance in the United States, most dollars were awarded via a purchase order versus a delivery order or task order against an established contract, and most were the result of a Request For Quotation (RFQ) versus a Request For Proposal (RFP) which means the initial level of effort for responding was a little to a lot less than if it were an RFP.

If you are a small federal contractor who believes these buys are not worth your while, or you simply need more information to understand the opportunity, call or write and I'll point you in the direction of the resources to help you make a good decision. The main issue for small federal contractors when it comes to this low-hanging fruit is not the number of opportunities or that they are too hard to pursue, it's much more basic than that. We're simply not asking for the business. Part of the ask means making the buyer aware of you, your company and your offering. In a nutshell, show up.

On a related note, I have a message for the folks in Congress. Quit over-complicating everything. There is a much more simple approach to take if you want to do something productive and measurable for small federal contractors. In fact, I have language you can feel free to use when updating the language in FAR Part 13.  It goes something like this:

“Each acquisition of supplies or services that has an anticipated dollar value exceeding $3,000 and not exceeding $150,000 $500,000 is reserved set-aside exclusively for small business concerns and shall be set aside.”

The result of this change this will make a very large number of your constituents happy for years to come. Questions?


Peace!

The Chief Visionary
www.theasbc.org/visionary

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


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Playing Monopoly, Government Contracting-Style!

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Sunday, November 02, 2014
Updated: Sunday, November 02, 2014

Playing Monopoly, Government Contracting-Style!

The report issued by the Government Accountability Office in July 2012 begins this way:

"In recent years, the government’s reliance on DUNS numbers has increased significantly. There has been a dramatic increase in the number and types of entities that are required to have DUNS numbers to do business with the government. As GSA has increased its use of the DUNS number and business information services, its costs have increased from about $1 million in 2002 to approximately $19 million per year under the current contract, a sole-source contract awarded to Dun & Bradstreet in 2010 for a 3-year base period with options for 5 additional years—the contract now totals up to $154 million."

It's not as if this is new information since it's been discussed by Government and Industry for years. From the perspective of Industry, it's just one of those necessary evils of engaging with Uncle Sam. Why the 'necessary evil' reference? One of the first things new contractors must deal with is the incessant pestering and scare tactics of Dun & Bradsteet telemarketers who all too often omit the fact that acquiring and maintaining a DUNS is "...absolutely free for all entities doing business with the Federal government. This includes current and perspective Contractors, Grantees, and Loan recipients." It doesn't stop then since I receive updates from literally hundreds of companies who convey the latest scam/spam calls they receive from D&B trying to 'scare' them into purchasing monitoring services all in the interest of protecting their business reputation. I've been told by several companies they were made to feel as if it (the purchase) were a requirement for obtaining or keeping their DUNS number.

What about that business reputation D&B so often eludes too? How many companies doing business with Uncle Sam actually have information on their D&B profiles and how much of it truly matters to any government agency? Aside from that which is uploaded when the profile is created what value does D&B provide when it comes to government contracting? What if there is no 'commercial' information available on your company because you never have and likely never will do commercial business? What if the commercial business you do (such as teaming and subcontracting) is not information that can or will be made available to D&B?  Again, how relevant is D&B to government contracting?

Here's another issue cited in the GAO report:

"Also, due to the proprietary nature of DUNS numbers, Dun & Bradstreet has placed restrictions on how GSA can use DUNS numbers. This limits the purposes for which the government can use the data and hampers the ability to switch to a new numbering system." Hmm.

Here's my question. How can a piece of data that is publicly reported in Government systems such as FBO.Gov, FPDS-NG and others be restricted from use by the public for any reason? For example, companies that compile government contracting data and make it available for a fee are apparently not allowed to use the DUNS number in their reporting which is pretty interesting since the only way to truly (and efficiently) capture historical award information is by using the Global DUNS Number. Whether using FPDS-NG, USASpending.gov or a third-party system, if you don't capture company information at that level then your results are suspect. Why? Have you seen all of the company name variations listed? All it takes is for a comma to be left out, or a space added and voila -- your company has a new entity name courtesy of Uncle Sam. Nothing intentional, just a data entry thing that happens all of the time. I've seen companies with more than five variations of their name in FPDS-NG with awards under each. Pulling data on one would not get you the information on the others. The proprietary tie that binds is DUNS.

Would I love to see Uncle Sam get from under Dun & Bradstreet's thumb? Most definitely. Especially since their restrictions directly interfere with the ability of other companies, large and small, to conduct business using open source information. Maybe Federal Trade Commission should take a long hard look at the negative impact of this veritable monopoly on Government and Industry. After all, according to the GAO report "GSA believes that Dun & Bradstreet effectively has a monopoly for government unique identifiers that has contributed to higher costs."

Sounds like a good reason for increased scrutiny to me.

Here's the topper. Should GSA ever find a way to part ways with Dun & Bradstreet, one of the negotiated terms is that GSA would have to 'delete associated DUNS data when the contract with Dun & Bradstreet ends.'

Shouldn't that have been some indication this relationship would not be in the best interest of the Government?

Peace!

The Chief Visionary
www.theasbc.org/visionary

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


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Small Federal Contractors Should Respect the Fruit!

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Sunday, October 19, 2014
Updated: Sunday, October 19, 2014

Small Federal Contractors Should Respect the Fruit!

Let me start with how psyched I am that over the last thirty days I've been contacted by members letting me know they've been awarded orders processed using Simplified Acquisition Procedures, valued over $2 million dollars! Graciously, they attribute these successes to either participating in our trainings or receiving direct support during the development of the deal. Let's go get more!

When I'm leading our workshop 'Finding and Winning Simplified Acquisitions to Grow Your Business' one of the first points I make is 'these small buys often lead to bigger opportunities.' I quickly follow with the tale of my reseller days taking over a mismanaged territory when I was brand new and low man on the pole. I think the company figured I couldn't do any more harm since they had no business there whatsoever so off I went! In order to get opportunities (and keep my job!) I had to build trust, and fast. Long story short, one of the people I convinced to give me a shot was Ernie Taggart, a retired sailor running projects at Naval Undersea Warfare Center Keyport. Six months of micropurchases (on the IMPAC card versus SmartPay) and some simplified acquisition buys later, Ernie flipped me my first million dollar program buy building three electronic classrooms for the F/A-18 Hornet. Not bad for a kid who was still very wet behind the ears in the world of government contracting.

This is just one of the many reasons I try to help small federal contractors understand why they need to have respect for what I consider to be low-hanging fruit. Some of the other reasons include:

  • in recent fiscal years, Simplified Acquisitions represent over four percent of governmentwide spending;
  • lower cost of pursuing and responding to these opportunities (ask me about RFQ vs. RFP);
  • majority of the buys are competitively awarded;
  • an inherent preference for small business contracting;
  • on average, two-thirds of the dollars obligated are not against established contract vehicles, limiting (or eliminating) the need to invest in GSA Schedules, BPAs, IDIQs, etc.;
  • in FY14, less than fifteen percent of total dollars obligated were the result of modifications, meaning more dollars were contestable.

Today, however, buys made via the Simplified Acquisition Procedures are much more robust when it comes to overall fiscal obligations and you don't need to wait for larger buys to come along. In some cases, the simplified acquisition buys themselves are the larger buys. It's not uncommon to see simplified acquisition purchases in excess of one million dollars. You can, at least in part, thank agencies for leveraging the Commercial Item Test Program at FAR Subpart 13.5 for this.

For example, reviewing FPDS-NG for initial buys (no modifications included) where the action obligations for each unique contract number was $1M or more accounts for $3.3B in spending during FY14. This was shared by 516 small and large companies over 837 contract actions. The spread from top to bottom ranges from $1M to $586M for each company. By the way, the company with $586M is a small business out in Idaho working for U.S. Mint. In a way, you could say they are literally printing their own money since they provide the raw materials Treasury uses for coinage!

Another area I focus on is the fact spending by fiscal year since FY10 shows a steady increase in obligations for these types of buys while at the same time, total governmentwide contracting dollars are declining. For these simplified buys, it's not that the percentage has increased due to an overall smaller pot, the actual number of dollars obligated has grown each fiscal year.  To top it off, we appear to be on track to do it again in FY2014 but won't know the final spend until December 31st since DoD obligations are made viewable to the public ninety days in arrears. We only need two billion more to show up between now and then to match FY13 spending. Did I mention DoD is the biggest spender in, well, everything! Based on total obligations we're already ahead of last year by percentage since the governmentwide total is roughly $100B less than the FY13 spend. Stay tuned.

Let's talk about results for small business. Of the $15B FPDS-NG reports for FY14 Simplified Acquisitions, over $8B was obligated to small federal contractors. Of that total, less than $4B was the result of a set-aside.

 

How much business is good business for you? For quite a few companies we know, $500,000 can go a long way, so that's my benchmark for this next factoid. FY14 YTD (remember, we're still tallying FY14) FPDS-NG reports 2,676 small business concerns being obligated at least $500K and as much as $574M. This represents a total pot worth $5.75 billion dollars. That could be quite a few jobs created and/or sustained and the kind of dollars that can make it possible for small companies to stay afloat while awaiting larger opportunities through the various contract vehicles and programs they may be chasing.


During FY14, sixty-one federal agencies, boards and commissions took part in the simplified festivities with the top fifteen accounting for $14.5B of the spend. By the way, all of this information is easy to access and readily available in the public domain. Any company can quickly ratchet up a plan to identify who is spending at the department, agency or even contracting office level. Like everything in government contracting, what matter's most is how relevant and timely your information is, and how good you are at developing and managing relationships.

The diversity of what agencies buy using streamlined procedures never ceases to amaze me. Over one-thousand NAICS Codes and more than 2300 Product and Service Codes were referenced, making it literally an opportunity for nearly every type of business, regardless of product or discipline, to pick some low-hanging fruit of their own.

The one area I would like to see changed is the number of dollars competitively awarded to large companies. For FY14, that number currently stands at $4.5B. You may have heard me refer to these dollars as the 'Small Business No-Show Penalty' because it really should not be happening in my opinion and it's something at least partially within our control.

Here's why.

With the exception of buys made using the Test Program exception, these purchases are 'reserved exclusively for small business concerns' which means agencies in a sense have to justify when they don't set-aside buys in the threshold ($3000 to $150K). In order to compete these as Full And Open versus Set-Asides, agencies made the determination they would not receive offers from at least two small business concerns competitive in terms of price, delivery and quality. As I've said before, I'm not blaming the agencies, I'm blaming us for not showing up!

Again, using publicly available information, you can determine precisely who is buying what you sell, who the last order went to, and how it was purchased. All we need to do is take the opportunity to make ourselves visible and then we can show them how viable the small business community is.

The part that really bugs me is the 'profile' of who is buying and what they are buying is very, very similar when you compare buys from small businesses and buys from other than small businesses when Simplified Acquisitions are leveraged. We need to get on the ball so small businesses can capture the lion's share of Simplified Acquisition obligations during the new fiscal year.

Speaking of the new fiscal year, nearly $300M in Simplified Acquisition have already been obligated, but keep in mind, that does not include Department of Defense spending, yet.

In a previous article I closed by referencing low-hanging fruit as part of a balanced diet approach. This time I ask, do you like apples?

Peace!

The Chief Visionary
www.theasbc.org/visionary

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


Tags:  $15B  acquisition  agency  billions  business  contract  government  obligations  simplified  small 

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Loneliest Number Or Not, It Pays To Be The 'One'

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Monday, October 13, 2014
Updated: Monday, October 13, 2014

Loneliest Number Or Not, It Pays To Be The 'One'

I was three years old when Three Dog Night released their hit 'One is the Loneliest Number' and now, nearly fifty years later, I get to use it as a reference for lost opportunities in government contracting. Not just any lost opportunities but Simplified Acquisition buys where the government recorded only one offer (Yep! Just one!) from industry when these competitive purchases were made. Are you a little curious about where I'm going with this one? Here we go!

Today I'm looking at dollars left on the table from low-hanging fruit opportunities worth $3.1 billion for FY14 and just over $42 million for FY15 year-to-date.

Here's the criteria:

  • All obligations are the result of Simplified Acquisitions based on the Solicitation Procedures

  • Only base/initial awards were included, not modifications (which deducted $400M from the total)

  • Number of Offers Received were fewer than two (2)

  • Extent Competed includes:
    • Competed Under SAP (Simplified Acquisition Procedures)
    • Competitive Delivery Order
    • Full And Open Competition
    • Full And Open Competition After Exclusion Of Sources

  • Award and Indefinite Delivery Vehicle Type includes:
    • Basic Ordering Agreement (BOA - an IDV)
    • Blanket Purchase Agreement or BPA (incl. GSA/BPA) this is an IDV
    • BPA Call (delivery/task order against a BPA)
    • Definitive Contract (mutually binding contract for goods services - not an IDV)
    • Delivery Order (delivery/task orders against BOA, BPA, FSS, GWAC and IDC)
    • IDC (incl. IDIQ and MAC - also IDVs))
    • Purchase Order (offer by an agency to purchase goods/services - not an IDV)

Are we good? Okay, here's the meat.

During FY2014, sixty agencies, boards and commissions obligated nearly $15B using the Simplified Acquisition Procedures. This number will likely increase since FY14 is still being closed out and final numbers for DoD won't be publicly available until the end of December. The final number is going to be my next 'low-hanging fruit' blog that discusses the ever-increasing use of Simplified Acquisitions by civilian, defense and intelligence agencies. For example, Simplified Acquisition obligations are currently at $15B with $353B in total FY14 obligations governmentwide. Compare this to FY2012 when agencies obligated $15.4B using Simplified Acquisitions when they obligated $518B governmentwide. Total dollars go down and these streamlined, inherently small business-friendly buys continue to increase. Stay tuned for that one but now back to the topic at-hand.

With $15B in streamlined buys for products and services already accounted for, I wanted to see how much was left on the table, so to speak. As I mentioned earlier, I'm looking at buys that were competed, but apparently only one response from industry was received. For the $3B in FY14 buys this equates to 103,000 purchases by fifty-nine agencies during the last completed fiscal year. The top five departments by obligation are DoD, Broadcasting Board of Governors, HHS, Justice and VA, accounting for $2.2B of this one-offer spend.

For FY2015, $41M in one-offer competitive buys are attributed to Justice, VA, Treasury, USDA and DHS. For the record, there were 1,354 unique purchases processed to get to the $42M. That's an average of better than $31K per buy. That's not a bad chunk of change when you think about it.

Now here's what I don't understand. Over $30M of the FY15 one-offer buys were competitively awarded to large businesses while $1.7B of the $3B in FY14 one-offer buys went to large business. It could have been mid-sized businesses, too but it wasn't small business. Here's how I interpret this. Small federal contractors don't know or don't care to look for these buys that could quite literally 'help keep the lights on' while waiting for the larger deals to come in. Had these been sole-source buys I wouldn't have a leg to stand on, but because they were competitively awarded to large companies, it means small business essentially did not show up.That needs to change.

 

Just in case you were wondering, $1.8B of the FY14 total and $21M of the FY15 total were issued by Purchase Order and Definitive Contract with PO's far and away accounting for the bulk of those dollars. These are buys that do not reference an IDV contract number which most often means you don't need a GSA Schedule, BPA, GWAC or IDIQ to pursue these opportunities.

Small contractors continue to say they are starving for viable opportunities and I continue to espouse the benefits of low-hanging fruit as part of a balanced diet ...er ...approach. You knew what I meant, right?

 

Peace!

The Chief Visionary
www.theasbc.org/visionary

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


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Do You See the Opportunities You're Missing?

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Friday, October 03, 2014
Updated: Friday, October 03, 2014

Do You See the Opportunities You're Missing?

Just so it's off the table, without hesitation I can say I have been just as guilty of what I'm going to discuss as anyone else. With that out of the way...

If your company is in possession of a multiple award delivery order or task order contract from the U.S. Government, I ask, Do you see the opportunities you're missing?

I literally just hung up the phone after doing an interview with my friend Amy Morris (Morning Anchor at WNEW 99.1 CBS Radio DC) cutting another of my Position To Win™ segments when I recalled something we chatted about related to competition and multiple award contract vehicles. Naturally, that meant I had to go dig up some information so I could get a more clear picture.

The results I found were not what I was expecting and here's why.

When companies pursue multiple-award contracts issued by government agencies, the expectation is they will be part of an exclusive group vying for opportunities available only to them and those they invite. Pursuing GSA Schedules, IDIQs MACs, BOAs, BPAs and GWACs is big business. Not only does it require a certain amount of skill, it's never bad to have some luck thrown in there as well. And the duration of some of these delivery order and task order contracts can range from one year to a decade, making it even more critical to secure a spot, else you run the risk of being shut out of substantive opportunities for some time. But winning a spot on a contract like Seaport-e, SEWP, NETCENTS or OASIS is just the beginning. If you are successful at that stage, then the real work begins, and that is where a lot of companies encounter their biggest challenges. I've worked for and partnered with companies whose post-award strategy involved sitting back and waiting to see what got tossed over the fence. Let me tell you how well that works out.

Which brings me to the real point of this piece. Why would companies make the investment to pursue and win a contract like this and then squander it? If there is even a half-truth to the information I captured today it represents a very poor state of affairs for a number of companies.Let me explain.

I did a review of multiple-award contracts (BOA, BPA, FSS, GWAC and IDC) and orders placed against them (BPA Calls, Delivery Orders and Task Orders) for all of FY2014. I examined only competitive buys and pulled data for those where the government indicated fewer than three offers were received at the BPA Call, Delivery Order and Task Order level. As a reminder, these are only for established contract vehicles awarded to two or more vendors. Here's what I found:

 Beginning at the top line (BPA) here is what I see:

  • GSA/BPA contracts account for $25M in orders placed where fewer than three offers were received. Theis number reflects orders placed during initial award or modification to the initial award.

  • Orders (BPA Call) against BPAs where fewer than three offers were received for each total $1.1B in FY14 obligations.

  • Delivery orders represent buys made against BOAs, GSA Schedules (FSS) , GWACs and Indefinite Delivery Contracts such as IDIQs and MACs. Collectively, these orders account for nearly $31B in obligations where only one or two responses were received by the government.

  • The information submitted by agencies to FPDS-NG indicates agencies processed over 19,400 contract actions in obligating $32B where fewer than three vendor offers were received. For perspective, $20B of that was obligated when agencies cited only one offer was received.

To give you an idea of how many agencies this reaches, sixty-one federal agencies, boards and commissions contributed to the total spend and leveraged multiple award contract vehicles established by 129 different contracting agencies. The top fifteen 'IDV Contracting Agencies' (the owners of the contract vehicles that were used) account for $28B of the spend and include:

  1. Federal Acquisition Service
  2. Army
  3. Navy
  4. Veterans Affairs
  5. NASA
  6. Centers for Medicare and Medicaid Services
  7. Office of Procurement Operations (DHS)
  8. State Department
  9. USAID
  10. Education
  11. Air Force
  12. NIH
  13. DISA
  14. Mint
  15. IRS

 As far as what was being purchased, it covers the spectrum. The NAICS Codes referenced on the multiple award contracts totals 954. Here is a look at the top twenty and the corresponding obligations:

We have a number of companies in The American Small Business Coalition who own or are teamed on many of the contract vehicles referenced here and we will definitely be working with them to ensure at the very least, they are in that range of one or two responses. If your company is involved in one or more of these contracts and this information is news to you, this is about the time I would recommend a sincere retooling of your organization's strategy and a deep dive into the kind of information that will help you make the necessary changes.

In closing, here's a quick note to the awardees of NASA SEWP V. SEWP IV accounts for just over one billion of these low and no competition buys for FY14. Companies on DISA ENCORE II, $390M. Navy SeaPort, $1.5B. Department of Education TIVAS, $665M and State Department GSS, $258M.

Would you like to know more? Click here to call me or email me at founder@theasbc.org. You can always view my other articles by clicking here.


Peace,

The Chief Visionary
www.theasbc.org/visionary

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

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