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Aspiring 8a

8(a) Robust IT Growth

If your firm is in the IT industry and has been thinking about moving forward with an 8(a) Certification, now might be a great time to enter the federal marketplace.

 

As you can see from the table below, the average 8(a) firm in the IT Industry had over $6MM sales in 2020. Roughly 40% of 8(a) firms are in the IT industry. IT and construction are the two most popular industries for 8(a) certified firms.

 

Federal 8(a) IT Sales Overall - 12.5% average increase per year

Year

8(a) Sales

# of 8(a) Firms

Average Sales per 8(a) Firm

2018

10,736,667,029

2,260

4,750,738

2019

11,782,990,880

2,260

5,213,713

2020

13,578,143,575

2,260

6,008,028

 

8(a) firms that wish to exacerbate their future business development potential obtain a GSA Schedule as well. Around 43% of 8(a) IT firms take this step, and the sales results from obtaining a GSA Schedule were approximately $1.6MM last year, on top of their 8(a) sales.

 

GSA Schedule IT70 Sales - 15% average increase per year

Year

8(a) Sales

# of 8(a) Firms

Average Sales per 8(a) Firm

2018

1,193,755,121

912

1,308,942

2019

1,396,107,796

972

1,436,325

2020

1,585,267,514

983

1,612,683

 

Some 8(a) firms move onto the 8(a) STARS GWAC. This GWAC is set-up for 8(a) firms in the IT industry. This GWAC is not open enrollment like a GSA Schedule, therefore it is common for an 8(a) firm to obtain a GSA Schedule contract first, then wait for enrollment to open for STARS. A position on the STARS Contract was worth almost $2.4MM to the average 8(a) IT firm in 2020.

 

8(a) STARS (Not Currently Open) Sales - 12% increase over 2 years

Year

8(a) Sales

# of 8(a) Firms

Average Sales per 8(a) Firm

2018

1,668,784,096

787

2,120,437

2019

1,193,845,613

787

1,516,958

2020

1,863,130,272

787

2,367,383

 

As you can see from these three tables, 8(a) IT revenue on a per-firm basis has been growing at a substantial rate. To take full advantage of this growth, we generally recommend for 8(a) firms, if possible, to simultaneously obtain both a GSA Schedule Contract and a 8(a) Certification. Then the firm should apply for 8(a) STARS during the first available enrollment period. the last one was over the summer. We generally contact our past clients when STARS becomes open, so they do not miss this important date. We find that taking these additional steps maximizes the value of an 8(a) Certification for a firm.

 

If you are wondering specifically how an 8(a) Certification, and possibly a GSA Schedule in addition, could be a huge advantage to help expand your business through federal contracting, I always recommend contacting an industry expert such as ez8a, Advance 8a or Advance GSA. All of them have the expertise in evaluating your firm's potential, and none charge for an initial phone consultation.

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