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Saturday, July 1, 2017

Marketing to Achieve a Small Business Set-aside Government Contract



Marketing is one of the greatest challenges for the small business federal government contractor. We have previously discussed the federal government marketing process at the following articles:

Insights to Succeed

This posting will address sculpting a government contracting business opportunity to the point where it becomes a sole source or small business group-designated set aside procurement.


Small business group-designated procurements are far more frequent than sole source contract awards.  Agencies must prepare special justifications for sole sourcing and those most frequently approved are for Hub Zone and Small, Disadvantaged [8(a)] firms (see table below).
Small business group designations are beneficial to firms who hold them by enhancing the probability of an award through agency restrictions on prime contractor bidding to only those who hold the group designation. Others may bid as subcontractors to the prime but the prime small business contractor must be capable of performing at least 51% of the total effort in terms of work scope, hours and dollars.  
In either sole source or group-designated marketing, an agency making the buy must be convinced that sufficient capability exists in a single company or in the small business designated group community to set a contract aside. The agency must be convinced early – before a formal procurement announcement is published on FEDBIZOPPS. 

Marketing to achieve a limited competition under a small business group designation or eliminate competition under a sole source contract assumes the marketing enterprise has one or more of the following federal government set-aside designations:

DESIGNATION                                                         TARGET
Small Business                                           (Group Set Aside Potential)
Small Woman-Owned Business                 (Group Set Aside Potential)
Small Veteran-Owned Business                 (Group Set Aside Potential)
Small Disabled Veteran-Owned Business  (Group Designation Set Aside Potential)
Small Hub Zone Business                          (Sole Source and Group Set Aside Potential)
Small Disadvantaged Business 8(a)          (Sole Source and Group Set Aside Potential)

Federal government procurements are further classified under the SBA Small Business Size Standards in terms of North American Industrial Classification System (NAICS) Code, number of personnel and/or annual sales. To determine whether a firm qualifies for a given bid, note the NAICS for a given solicitation and download the SBA Small Business Size Standards the Box Net “References” Cube in the right margin of this site.

Part of the sole source or designated group set aside marketing task is to suggest to the agency the NAICS Code (hence the size standard) for a prospective procurement.
Registering to bid government contacts and establish sole source and group designations may be achieved using guidance in the below articles:
Hub Zone and Small Disadvantaged Business 8(a) designations are lengthy certification processes. The remaining designations in the above table are self-certifying at the above government contract registration web site, and are verified by site surveys and bid vetting for each solicitation prior to contract award. 


Effective set aside marketing reaches the agency decision makers with technical, budget and schedule authority before a synopsis of the requirement is posted on FEDBIZOPPS. 
The objective of this form of targeted marketing is to get concurrence from the government to set the program aside sole source if the company has an 8(a), or Hub Zone Certification or reserve it by one of the above group designation classes to eliminate the prospect of full and open competition involving large business.

  • Become known to targeted agency personnel by visiting their program offices and meeting the decision makers.  Bring a capability statement:
  • Present your qualifications openly, objectively and specific to their needs.  You must determine what those needs are through market research, trade magazines, research on what they are buying on FEDBIZOPPS, as well as postings on their web site that are future-program oriented.

  • Subscribe to periodicals like "Washington Technology" and other trade magazines.  Observe agency trends and analysis that impact your market segment.  There have been set aside programs marketed by small companies through acquainting agency management and technical personnel with capabilities they were not aware existed in the small business community or fulfillment of needs they in fact did not know they had.

  • Pay particular attention to FEDBIZOPPS "Sources Sought" or “Requests for draft RFP Comment”  on programs that have yet to be formally solicited. Obtain an appointment to present your capabilities to the decision makers (not the gate keepers).  Be courteous to contracting officers but understand they are not the individuals who make source selections. Understand that once the requirement is formally published on FEDBIZOPPS the gate closes on informal visits to the customer and the competition begins in the form of proposals by competitors.  It is too late at that point to set the program aside for a sole source or a small business designation if it has not occurred by the publication stage.

  • Cultivate teaming relationships with other firms in your industry and look for early opportunities in agencies, not only to prime a program but to bring a team of qualified contractors in lesser roles to fulfill them with you or join a team being led by a more experienced firm:
  • Understand the small business start up past performance challenge and work to meet it:
  • Attend small business outreach events by agencies and prime contractors.  Stay attuned to who is attending and research their needs and requirements.

  • Make a point to be present at bidders' conferences for existing solicitations that you may not choose to bid but which may lend insight into the agency needs and prime contractor relationships in the future.      

As a small business becomes known in the federal government contracting community, successful marketing of sole source or group-designated business becomes easier, but it is always a challenge due to the need for taking early action in windows of opportunity.  Find those windows and communicate capabilities to the decision makers and industry team members who can help you.  

If you are eligible for any of the designations discussed in this article, make small business set asides or sole source procurements key elements in your marketing plan. 

1 comment:

Ken Larson said...


On 2 November 2011 DoD, GSA, and NASA issued an interim rule, effective the same day, amending the Federal Acquisition Regulation (FAR) to implement section 1331 of the Small Business Jobs Act of 2010 (Jobs Act). Section 1331 addresses set-asides of task- and delivery-orders under multiple-award contracts, partial set-asides under multiple-award contracts, and the reserving of one or more multiple-award contracts that are awarded using full and open competition. Within this same context, section 1331 also addresses the Federal Supply Schedules Program managed by GSA.

DoD, GSA, and NASA are coordinating with the Small Business Administration (SBA) on the development of an SBA proposed rule that will provide greater detail regarding implementation of section 1331 authorities.

An interagency panel, formed in 2010 by the Obama administration, to study small-business contracting, also found the issue needed some attention since multiple-award contracts have become so popular.

This interim rule amends--

· FAR subpart 8.4 to make clear that order set-asides may be used in connection with the placement of orders and blanket purchase agreements under Federal Supply Schedules;

· FAR subpart 12.2 to acknowledge that discretionary set-asides may be used if placing an order under a multiple-award contract;

· FAR subpart 16.5 to acknowledge that set-asides may be used in connection with the placement of orders under multiple-award contracts, notwithstanding the requirement to provide each contract holder a fair opportunity to be considered;

· FAR part 19 to add a new section authorizing agencies to (1) use set-asides under multiple-award contracts--including set-asides for small businesses participating in the small business programs identified in FAR 19.000(a)(3); and (2) reserve one or more contract awards under multiple-award contracts for small businesses, including any of the socio-economic groups; and

· FAR subpart 38.1 to add a reference to FAR 8.405-5 to make clear that order set-asides may be used in connection with the placement of orders and blanket purchase agreements under Federal Supply Schedules.

· FAR part 52 to amend existing solicitation provisions and contract clauses, including FAR 52.219-6 to provide notice of total set-asides and partial set-asides under multiple-award contracts, and revise existing contract clauses to address limitations on subcontracting for small businesses under multiple award contracts.

OFPP wants agencies to identify possible multiple-award contracts through which they could set- aside orders for small businesses. They also want agencies to set aside more orders when using GSA’s Schedules, according to the notice.