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Aspiring 8a

8(a) Per Firm New Heights

The number of 8(a) Certified firms has dropped dramatically over the course of the last 15 years. In 2006, there were nearly 10,000 firms in the SBA’s 8(a) BD Program. Over time the numbers naturally drop due to attrition, as an 8(a) firm is only permitted to be in the program for a nine-year period.

 

According to the most recent Office of Inspector General Report:
“Though over 2,000 applicants apply each year, the SBA historically rejects most applications as incomplete and missing documentation. Typically, only 25% of the applicants or approximately 500-600 applicants per year are ultimately certified to participate in the 8(a) BD Program by the Associate Administrator of the Office of 8(a) Business Development.”

 

Since that time the number of 8(a) firms has declined by another 600 firms. This drop is created unprecedented opportunities for 8(a) firms that are able to successfully navigate the 8(a) approval process.

 

 

Year

# of 8(a) Firms

Federal 8(a) Spending in (Billions US $)

Contract Dollars per 8(a) Firm (Millions US $)

2006

9,700

$23.0

$2.4 MM

2007

9,400

$24.9

$2.6 MM

2008

9,500

$29.3

$3.1 MM

2009

8,800

$33.5

$3.8 MM

2010

8,400

$34.4

$4.1 MM

2011

7,800

$32.4

$4.2 MM

2012

7,600

$32.3

$4.3 MM

2013

7,300

$30.6

$4.2 MM

2014

6,800

$34.7

$5.1MM

2015

6,600

$35.4

$5.4MM

2016

6,700

$39.1

$5.8MM

2017

6,300

$40.2

$6.4MM

2018

6,100

$46.5

$7.6MM

2019

5,900

$51.6

$8.7MM

2020

5,950

$52.0 (est.)

$8-9MM (est.)

 

The chief reason the SBA believes there has been a drop in the number of 8(a) firms is that in 2006-2008 there was a great deal of stimulus spending. When the economy as a whole has slowed down the stimulus spending, it serves as free advertisement for the 8(a) BD Program. We have now seen a 40% drop in the number of 8(a) participants since 2006, and as you can see from our table above, there has been over three times the 8(a) certified firm spending by federal agencies.

 

Eligible firms should not allow themselves to get discouraged and should work through the process of obtaining this certification.

 

If you are wondering how an 8(a) Certification could be an advantage to help expand your business through federal contracting, I always recommend contacting an industry expert such as ez8a or Advance 8a. Both have the expertise in evaluating your firm's potential, and neither charge for an initial consultation.

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