8(a) Certification is the subject of a lot of discussion among socially and economically disadvantaged business owners. However, most people I talk to can only name a few of the benefits that being a part of the SBA’s 8(a) Business Development Program can provide. To set the record straight, I will go over the ‘Top 10’ different benefits that 8(a) certified firms enjoy.
(1.) Sole-Sourcing Contracts — One of the most known benefits of the 8(a) Certification is that it allows its holder to obtain sole-source contracts. These are contracts that are directly awarded to 8(a) certified firms without the federal buyer putting the contract out for open bid. This gives the 8(a) firm the ability win contracts for a fair price without competition. 8(a) firms in their 1st through 3rd years win most of their contracts using this avenue.
(2.) Limited Competitors — The 8(a) certification limits the field of competition to only small businesses that are 8(a) certified, which is currently around 5,600 federal contractors from the rough approximate of 24 million businesses in the USA.
(3.) Large Federal Spending — In the latest report card, the federal government spent over $45+ billion dollars in the 8(a) BD Program, which is an average of $6-8 million per 8(a) firm.
(4.) Reduction of Red Tape — Sole sourcing and set-aside contracts eliminates the red tape involved in federal contracting. That allows the business owners to focus on running their business, rather than submitting complex RFQs.
(5.) GWAC and IDIQ Contracts — Large Indefinite Delivery Indefinite Quantity Contracts allow positions for 8(a) firms and other firms with SBA Certifications. A position on one of these contracts can steer many large awards to the 8(a) firm.
(6.) Set-Aside Contracts — More established 8(a) firms bid on 8(a) set-asides. These are contracts where only 8(a) firms are permitted to compete. This reduces the scope of the competition without having the $4MM contract ceiling that most sole-source contracts have.
(7.) Joint Venture/Mentor Protégé Programs — 8(a) firms are permitted to partner with other firms in joint venture or mentor protégé arrangement. This helps the 8(a) firms expand their knowledge of federal contracting and gain experience working on federal contracts. This also boosts their federal performance history so they can ultimately win larger contracts on their own.
(8.) Growth — 8(a) certified firms grow much faster than their peers. In a recent report by the Washington Post on the fastest 50 IT firms in the United States of America, 31 out of the 50 firms were 8(a) certified.
(9.) Construction Friendly — 8(a) Construction firms are highly effective at winning federal and military contracts gauged by the fact that 35% of 8(a) certified firms are in the construction industry.
(10.) FEMA Contracts — 8(a) certified firms, due to the speed in which they can be awarded federal contracts due to being pre-vetted, often are major providers to presidential disaster areas.
If you have any questions on getting qualified for the 8(a) Certification, or any other federal or state certifications, I always recommend contacting an industry expert such as ez8a. They can provide more in-depth analysis, and can be reached at (859)442-3300. They do not charge for this initial consultation.