Two Key Issues are addressed here:
1. How certification affects doing business with the Federal Government.
2. Differences between 8(a) and SDB Certifications? (click here )


The Federal Government
"Horror Show or Great Market?"

You’ve probably heard some of those horror stories about doing business with the Federal Government. Most of those tales are gross exaggerations. Did you ever think that those stories were made up by existing government contractors that want to keep it all for themselves. Here are ten great reasons why you might want to pursue this market:
 

1.$200B annual procurement budget: The Federal Government averages about $40 billion annually with small businesses. It must, by law, spend at least 23 percent of its prime contract dollars with small businesses. In addition, five (5) percent goals also exist for minority and woman-owned businesses.
 

2.Buys almost any product or service imaginable: You build it or provide it and it’s almost certain that the Federal Government, the biggest customer in the world, has a need for it, and is already buying it from one of you competitors. Even the Department of Defense, which accounts for about 60 percent of all procurements, buys everything from food services, to management consulting, to software, to guard services not just guns, planes and ships.
 

3. Advertises its needs well in advance: The Federal Government is about the only client you’ll ever meet that describes what they need, when they need it, who to talk to about it, how much they’re thinking about paying for it, and when they’re going to buy it! Most of the major agencies have Procurement Forecasts, web sites and on-line procurement bulletin boards to help you identify business opportunities.
 

4. Purchasing ground rules clearly specified: Whether you’re dealing with NASA, the Air Force, Treasury, or any other Federal Government agency, they all follow the same rules the Federal Acquisition Regulations. The requirements, advertising, procurement, selection, payment and other steps are spelled out in these documents and you don’t have to learn new strokes for new folks as you do in other markets.
 

5. Customers can’t refuse to see or listen to you: Federal Government workers, whether they’re Generals, Admirals or GS-7’s all work for you and other American citizens. They want to hear from you, and if you approach them professionally, they can’t avoid your sales-pitch. When was the last time that you could say that about a commercial customer? 6. Many organizational friends available to help you: The Small Business Administration, small business offices in every Federal Government location, Small and Disadvantaged Business Specialists, Procurement Center Representatives, DoD’s Procurement Technical Assistance Center and even your local Congressional representatives are paid to help you succeed in business. You only have to ask!
 

7. Pays for work progress along the way: The Federal Government, through progress payments, milestone payments and the SBA’s various working capital and other loan guarantee programs helps you finance the contracts you’ve won.
 

8. Credit card purchases and simplified purchasing available: The Federal Government purchases of up to $2500 can be made with a government credit card and contracts from $2500 to $100,000 can be made quickly and simply by contracting officers who obtain just three bids, often from the companies listed in SBA’s PRO-Net listing of about 170,000 small businesses. Are you registered in PRO-Net?
 

9. Non-competitive as well as limited competition advantages available to selected businesses: As a certified 8(a) BD contractor, you can seek and be awarded a contract of up to $5M (for manufacturing) or $3M (for everything else) without having to compete, in the normal sense. If you compete as an 8(a) BD in a set-aside, your competition looks very much like you and its not the "big guys". As an SDB contractor, your price can be up to ten (10) percent higher or you can enter a contract competition with up to a 20 point (out of 100) head start. Both of these programs can level the playing field for small, woman and minority-owned businesses.
 

10. Rewards your largest and meanest competitors to work with you: The Federal Government even provides incentives to the so-called "big guys" to contract with you in full and open competitions. You see, if they do, they are also eligible for the up to 20 points in proposal evaluation credits. Being certified just makes you a more attractive teaming partner with those "big guys".
 


8(a) vs SDB

A number of our clients have questioned why they should purchase our SDB certification product versus the 8(a) product. "If being 8(a)BD certified automatically qualifies me for the SDB program, why should I opt to complete this certification package? Good question! Here's a few great reasons:

 

1. If your adjusted net worth is more than $250K, but less than $750K, you qualify for SDB certification, but not for the 8(a)BD program.
 

2. If you and your immediate family members own more than a ten percent interest in another existing 8(a)BD company, you qualify for SDB certification, but probably not for the 8(a)BD program.
 

3. If another non-8(a)BD company that operates in the same or similar line of business as your 8(a)BD applicant company owns 10% or more of your business, you can qualify for SDB certification, but probably not for the 8(a)BD program.
 

4. If your company has not been in business, operating in your selected primary business area for at least two years prior to your application for the 8(a)BD certification, you are still eligible for the SDB  program, but not for the 8(a)BD program, unless you request and receive a waiver.
 

5. If you can't produce tax returns for the two years prior to your 8(a)BD application that clearly show revenues in your primary business area, you can qualify for the SDB certification, but not the 8(a)BD program.
 

6. If you can't demonstrate reasonable prospects for success in competing in the private sector if admitted to the 8(a)BD program, then you will be denied access to this program, but still be eligible for the SDB program. In assessing your potential for success, the SBA shall consider, among other factors, your access to credit and capital, including but not limited to long-term financing, access to working capital financing, equipment trade credit, access to raw materials and supplier trade credit and bonding capability, if applicable. P.S. If you haven't completed a business plan for your company, forget it! If you can't claim or demonstrate that you, your principals and your company are of good moral character, then you will be denied 8(a)BD certification, whereas, there is no equivalent request for this claim or associated data from you and your team for the SDB certification.
 

7. If you can meet all of the above conditions, we strongly suggest that you attempt 8(a)BD certification. However, if you're a relatively young company, just starting out, lacking a business plan, contract experience, adequate financing, demonstrated business management skills and other key success factors, then we also strongly suggest that you opt for the SDB certification. It's a great training ground for new Federal Government contractors. You'll even be a more attractive business partner for the "big guys". When you're ready, the 8(a)BD program will be there.
 

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