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Aspiring 8a

Six Factors that Lead to Federal Buyers Seeking Out 8(a) Certification Holders

Federal buyers more than regularly seek out 8(a) firms with which to do business. There are several excellent reasons for agencies using 8(a) firms, and this creates a large benefit to the 8(a) Certification holders.


Factor 1 - Congress has mandated that 5% of all federal procurement be earmarked for 8(a) certified firms. If you look at this on an agency by agency basis, all 60 federal agencies exceed this target with the most recent average coming in at over 8% of federal procurement being spent with 8(a) firms. This totals over $45B, which results in $6MM to $8MM per 8(a) firm.


Factor 2 - 8(a) firms are only in the program for a 9-year period. After the 9 years are over, the firm graduates from the 8(a) program, and is no longer eligible for 8(a) contracts.


Factor 3 - Many 8(a) contracts are awarded on a routine basis, and often, repetitive contracts are carved out of this. This means that when the agency prepares its budget, it is known which repetitive contracts it would like to source from 8(a) firms, or it will not achieve their 5% target.


Factor 4 – There has not been much growth in the number of 8(a) firms in recent years. The number of 8(a) firms has stayed between 5,000-6,000 firms. The number of new 8(a) firms per year is around 550. With only 550 new 8(a) firms to replace the firms dropping off, contract officers are often left scrambling to find 8(a) firms that are capable of performing the work they need completed.


Factor 5 – 8(a) firms can have contracts sole-sourced to them. The timeframe for completing a sole source contract is generally a few weeks, compared with months for other FAR compliant methods. When a contracting officer finds themselves in a pinch, such as with an unexpected procurement or a disaster type situation, sole source contracts are often the only remedy. This leads them to utilizing an 8(a) firm.


Factor 6 – Although the number of 8(a) firms has not been growing over the past decade, the federal discretionary budget has. This increase in federal spending creates more demand for 8(a) firms at agencies that are experiencing budget growth.


If you are wondering how each of these factors 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. They both have the expertise in evaluating your firm's potential, and neither charge for an initial consultation.


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