Small Business and the Federal Government

In the fiscal year 2010 the United States Federal Government came close to making their commitment of spending 23% of its budget with small businesses. They purchased $97,946,784,760.69 worth of goods or services from small business. The 22.6579% of spending is a 0.7633% improvement from the money spent with small business in the 2009 fiscal year. As the Federal Government makes strides in their overall spending goals with small business, they exceeded their 5% pledge of doing business with Small Disadvantaged Business in 2010 (7.9546% or $34,386,521,811 spent).

While this is good news for small business, there is still room for improvement; first with small business overall, and in particular with Service Disabled Veteran Owned Small Businesses (SDVSBEs), Women-Owned Small Businesses (WSBE), and Certified HUBZone Small Businesses. The Federal Government has pledged to spend 5% with Women-Owned Small Business and in 2010 they spent 4.0381%. There is a 3% spend goal for Service Disabled Veteran Owned Small Business and Certified HUBZone Small Business and in 2010 2.4966% was spent with SDVSBEs and 2.7687% was spent with HUBZone Small Business.

We’ve discussed the United States Small Business Administration (SBA) in previous entries including an introduction to the SBA, as well as, discussing their 8a Certification and Women-Owned Small Business Certification programs. Using the SBA’s resources and programs is one of the best ways of getting your small business in front of purchasers for federal government agencies. By holding an 8a, WOSBE, HUBZone, or VOSB (Veteran Owned Small Business) certification a federal agency and their primes can have confidence that they are utilizing a trusted small business.

Because federal agencies and their primes are mandated to meet these goals – to spend 23% of their contract dollars with small business, including 5% with SDBEs and WSBEs and 3% with SDVSBEs and HUBZone businesses – there is incentive for them to work with small certified business. If your company is interested in pursuing federal contracts, take a look at the SBA’s FY2010 Spend Goal Findings. Examining these findings can help you target the agencies you might want to sell goods and/or services to. Maybe you want to target an agency that is close to or has exceeded spending goals because you know they are committed to small business … like the Department of Health and Human Services which spent 22.0077% of their contract dollars with small business in 2010, or the Department of Veterans Affairs which spent 37.3469%.

Or perhaps you want to take the opposite approach and target agencies that need to increase the amount they spend with small business such as the Department of Energy (spent 7.6007% of their contract dollars with small business in 2010), the Federal Housing Finance Agency (spent 1.9441%), or NASA (spent 15.4595%).

No matter which approach you take you’ll want to make sure the agency or agencies you target (or their primes) are in need of the goods and/or services you sell. The process of selling goods and/or services to any government agency can be lengthy and expensive, which is why you’ll want to be certain that there is a need for what your business offers.