Small Business Programs in Federal Procurements: Part One

government contracts

This article is the first of two posts on small business programs in federal procurements. Here, we provide a general overview and will follow up in a related post with more details on the specific programs.

Procurement opportunities exist for large and small businesses alike. While formal, large-scale contracts (typically those greater than $150,000) are won by large concerns because of their ability to perform at such scale, many procurements are also won daily by small firms. In addition, subcontracting opportunities for small companies provide these businesses another avenue to participate in the government market.

FAR Parts 19 and 26 cover small business and socio-economic preference programs. The FAR outlines as the policy of the Government to provide the “maximum practicable opportunities in its acquisitions to small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns.”

Additionally, each federal agency must set an annual goal for participation in its contracts to ensure that small businesses get their fair share of work with the federal government. The Small Business Administration (SBA) is responsible for administering the Goaling Program which ensures that the government-wide goal for participation of small business concerns is established annually at the statutory levels and the reporting agencies’ achievements are relative to the goals. The SBA counsels and assists small business concerns and assists contracting personnel to ensure that a fair proportion of contracts for supplies and services is placed with small business.

The FAR further states that small businesses “must also have the maximum practicable opportunity to participate as subcontractors in the contracts awarded by any executive agency, consistent with efficient contract performance.” A variety of subcontracting opportunities exist for small businesses. In additional to cultivating relationships with large primes the old fashion way through various traditional business development efforts, small concerns can find opportunities by searching for awards at FedBizOpps (FBO) and the Department of Defense.

As part of the small business / socio-economic programs in federal procurements, the government and the SBA have identified certain classifications that identify the type of small business concern competing for a contract. An entity can hold one or more of these classifications, agency goals in the Goaling Program are organized according to these classifications, and contracts are “set-aside” according to these classifications.

In our next post, we will exam the specifics of each of these programs.