How small businesses can adapt to new 8(a) and procurement realities

It's true: the 8(a) program seems to be dying of a thousand cuts. All 8(a) firms are treated as suspects overnight, "once 8(a) always 8(a)" is dead, and competitive 8(a) procurements are now preferred over sole source 8(a) awards.

It's also true: small businesses' offices are being decimated. The support they used to provide has disappeared from many agencies. And the rule of two is not required for multiple-award contract task orders, a change large firms will undoubtedly welcome.

All the challenges to small businesses (SBs) reported by Nick Wakeman in his last article about these topics are real and significant.

But how we choose to react to events is as important as the events. The final output depends on both elements. We have that choice.  At the business development and capture level, the event is that contracting officers are given more latitude to make procurement decisions in the name of agility and speed, and therefore, they can decide "against" part of the interests of small businesses and 8(a) firms. Our reaction should be to understand CO's pressures, incentives and options more deeply, and then strategically align our interests with theirs.

After all, both parties want to support the agencies' missions, in different capacities. For many contractors, the relationship with the contracting officer is a nice-to-have. It must now be treated as a priority.

First challenge: 8(a) incumbent vendors can no longer assume their contracts will be recompeted as 8(a) set-asides. The CO can now decide to procure the recompete as an 8(a) set aside, but also as a woman-owned small business, HUBZone, or service-disabled, veteran-owned small business set-aside.

If your company is the incumbent, you have some extra work. If in the past our efforts to influence the procurement didn't include the set-aside, they absolutely must now. If you are 8(a) and also a WOSB, HUBZone or SDVOSB, depending on how many years you have left in the 8(a) program, it may actually be in your own interest to move the requirement to a different set aside.

If theperiod of performance is five years and you have less than five years in the 8(a) program, it is in your interest to move it out of the 8(a) program sooner rather than later, so you can prime the next iteration. This is long-range shaping: influencing the immediate upcoming recompete, with the next one in mind.

If you don't have any other designation, then argue for the strength of the 8(a) vendors. But regardless of the set-aside you are pushing for in different scenarios, do some research to demonstrate to the CO that there is a capable pool of vendors in the set-aside you are promoting, with the help of FPDS or USAspending.gov. You can document a list of vendors with the name and value of their relevant contracts. If the CO posts an RFI, make sure companies in the set-aside you are promoting respond.

Don't think "I can do it", think "we can do it".

But let's step back for a big picture assessment: what does this ability to take a requirement out of the 8(a) program mean for the rest of the 8(a) companies that are not the incumbent vendor? We are seeing it already: it means there are more 8(a) opportunities being recompeted, that were previously sole sourced more under the radar. It means more opportunities - potentially many more.  This is actually good news for all 8(a) contractors except for the incumbents.

Second challenge: yes, small business offices have been decimated, and many agencies will no longer provide the level of support small businesses were accustomed to. The firms most affected will be new entrants who relied on small business representatives to explain agency culture, vehicles, forecasts, and players. But let's be honest: many companies had unrealistic expectations. Some expected them to make introductions or match opportunities for them.

At some point, like a child learning to ride a bike, vendors must move forward on their own and build their own basic business development capability. Small businesses must double down on fundamentals and invest time in researching how agencies procure, finding opportunities, and relationship-building with program and contracting offices.

Third challenge: if you are a small business prime holder of a multiple award contract and want a small business set-aside, you will need to work harder. In the past, demonstrating that at least two small business vendors could perform could have been enough. Now CO's have greater discretion to decide whether to apply the rule of two or not. They may believe large firms bring lower delivery risk, more experience, or more resources.

This perception can be countered. Highlight areas where large firms may actually introduce risk or inefficiency, such as higher rates, lower interest in low dollar value requirements, and reduced agility, to create healthy doubt about full and open competition.

I also recommend pursuing an “over-and-under” teaming strategy: establish two teaming agreements, one where the large business is the prime and another where the small business is the prime. This approach allows  you to compete under both a small business set-aside and a full-and-open competition, while also addressing the CO’s perceived need for large-business participation.