Small businesses exploring the federal marketplace need to consider the different contracting options available and decide which suits them best.
Working with a prime contractor is the fastest way to begin. Subcontracting is the most popular partnering tool. It is an excellent way to test the waters of federal business without suffering undue risk.
From the Federal Acquisition Regulation:
Subpart 19.7-The Small Business Subcontracting Program - 19.702 Statutory requirements:
"In negotiated acquisitions, each solicitation of offers to perform a contract or contract modification, that individually is expected to exceed $700,000 ($1.5 million for construction) and that has subcontracting possibilities, shall require the apparently successful offeror to submit an acceptable subcontracting plan. If the apparently successful offeror fails to negotiate a subcontracting plan acceptable to the contracting officer within the time limit prescribed by the contracting officer, the offeror will be ineligible for award."
Subcontracting is not the only way two or more companies can join forces to respond to a procurement opportunity. Other methods include:
Many businesses, small and large, will want to sell under the terms of a Schedules contract.
Schedules (also called Multiple Award Schedules (“MAS”) or Federal Supply Schedules) are the most widely used federal procurement program. Over 12 million commercial items (defined as supplies and services) are available on Schedules.
If you choose to sell via Schedules, you must be registered in the System for Award Management (SAM). To qualify to be a Schedules contractor, your company must be in business a minimum of two (2) years and show an annual revenue of at least $25,000. Learn more about Schedules.
Being “on Schedule” is NOT a guarantee of a sale, or a work order. Often it means that your company will join a pool of select vendors, each of whom have negotiated terms and conditions for the similar/same items.
When a GSA customer decides to procure the good or service covered by a Schedule, it is purchased under the terms of the winning bidder’s contract (which was negotiated when the business got on Schedule).
Government-Wide Acquisition Contracts (GWAC)
Government-Wide Acquisition Contract (GWAC) - provide information technology (IT) solutions such as systems design, software engineering, information assurance, and enterprise architecture solutions. A GWAC contract requires a vendor to be registered in the System for Acquisition Management (SAM) but does not have a "years in business" experience minimum or an annual revenue minimum to bid for the contract.
A Governmentwide Acquisition Contract (GWAC) is a pre-competed, multiple-award, indefinite delivery, indefinite quantity (IDIQ) contract that agencies can use to buy total IT solutions, both products and services.
Pre-compete means that the group of vendors, or “industry partners” is selected during an evaluation process, and that group remains fixed until a new contract is created, or an existing contract is extended. Unlike GSA Schedules, where vendors are accepted on a rolling basis, GWACs have firm deadlines for selecting their vendor pool.
A number of GWACs specifically target small businesses:
- 8(a) STARS II - provides flexible access to customized IT solutions from a large, diverse pool of 8(a) industry partners.
- Alliant 2 (A2SB) Small Business – following on the success of the first Alliant Small Business GWAC, development of the 2nd generation program is underway.
- VETS - Veterans Technology Services, a small business set-aside GWAC, provides flexible access to customized IT solutions from a qualified, diverse pool of service-disabled, veteran-owned small businesses.
A small business may also find opportunities subcontracting to GWAC prime contractors.