SMALL BUSINESS USE RECORD BREAKS AGAIN

When the Administration said it was going to increase small business contract opportunities it meant it.  Small businesses were awarded more prime contract dollars in FY’21 than in any other year, a total of $154.2 billion.  That dollar total equates to over 27% of all contract actions, beating the government-wide 23% goal by more than 4%.  Impressively, federal agencies met the Administration’s 11% target for small, disadvantaged businesses, too.  That first-year goal will now climb to 15% by 2025.  These actions impact all businesses that sell to the federal government.  Large and medium sized businesses have work increasingly with small firms.  Few will walk away totally from a segment accounting for more than a quarter of their total market.  The types of small businesses to work with are important, as well.  In addition to the small, disadvantaged goal, federal agencies achieved their Service-Disabled Veteran Owned Business (SDVOSB) goal, making these types of businesses another important partner consideration.  Agencies fell short, again, of meeting their Women-Owned Small Business (4.63% v. 5% goal) and HUBZone (2.53% v. 3% goal).  Expect agencies to strongly emphasize increased prime contract opportunities in these areas.  The HUBZone program continues to be challenged by changing demographics, with some formerly designated businesses becoming so successful that they’re locations no longer qualify as “underutilized”.  Large businesses may find many woman-owned small firms closer to their own offices, potentially making teaming easier with such firms.  Discussions with federal customers on acquisition approaches are also always a good idea.  If today’s unrestricted contract is going to change to a small business re-compete, knowing how to act in advance can provide a strategic edge.