Georgia Tech Procurement Assistance Center

Family relationship, revenues and subcontracts caused affiliation, says SBA

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A small business was affiliated with companies owned by the business owner’s father and siblings, based on the family relationship and the companies’ ongoing history of doing business together.

In a recent size appeal decision, the SBA Office of Hearings and Appeals held that the small business had not successfully rebutted the regulatory presumption that companies owned by close family members are affiliated, because the small business had earned substantial revenues from the alleged affiliates, and intended to issue a subcontract to both affiliates with respect to the procurement at issue.

SBA OHA’s decision in Size Appeal of Industrial Support Service, LLC, SBA No. SIZ-5576 (2014) involved an Army Corps of Engineers solicitation seeking a contractor to provide certain repair work.  The solicitation was issued as a small business set-aside under NAICS code 238290 (Other Building Equipment Contractors).

Keep reading this article at: http://smallgovcon.com/sbaohadecisions/family-relationship-plus-revenues-subcontracts-caused-affiliation-says-sba-oha/

Want to grow your government contracting business? Be ready for what you wish for!

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Federal small business programs are valuable. But they can also inadvertently stunt or even slash the growth of companies that the programs are intended to help.

First, small business owners with big ambitions can capture big wins that pump up their revenue beyond their small business size standards. But without the support of federal small business programs, more than a few can’t win new work to sustain that growth. When the company shrinks again, that slide back into small business status means lost jobs.

Then there’s those that deliberately cap their business growth to hang on to the advantages of small business programs. Their plan is either to hold steady, or get acquired. That holding pattern represents lost opportunity.

But stagnation and backsliding aren’t inevitable. Practical tactics can help in the short term.

Keep reading this article at: http://www.bizjournals.com/washington/blog/fedbiz_daily/2014/06/want-to-grow-your-government-contracting-business.html?page=all

Reflections of a small IT contractor on the government shutdown of 2013 and 2014’s uncertainties

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[Note: This article was written by Terry Verigan, vice president of CompuCure.] 

Hurricane Katrina nearly killed CompuCure. In the wake of the storm, just three of us remained by Oct. 1, 2005, and the weeks ahead promised to be grim for our New Orleans-based IT services firm — what was left of it anyway. But we weren’t going to let that damn storm chase us away from our city.

By September 2013, eight long years after Katrina wiped out so many lives and businesses, CompuCure had rebounded sufficiently to make Inc. Magazine’s list of the fastest growing businesses in America. With a talented staff of 30 delivering projects that had achieved national recognition for quality and value, it was tempting to think we’d made it to some sort of safe high ground, economically speaking. But by late September, our president and owner, Angelina Parker, faced another storm, this one political. The federal shutdown nearly took down the business again.

While we had become accustomed to the disruptions that stemmed from continuing resolutions — the stop-gap budgets lawmakers typically adopted while they continued to disagree over larger spending questions — those rarely impacted our work at federal sites. Employees would clock in while budgets were frozen and eventually CompuCure would be reimbursed. Our line of credit was more than sufficient to carry on. Interest charges eat away at profitability, but we could keep going, knowing that our people and their families felt secure. Our most valuable resources, our employees, would still be on the job.

But the shutdown was different. It meant lost revenue to CompuCure, not just a delay in getting invoices paid. Disturbing questions emerged, notably: How would we keep our talented employees from moving to other companies less dependent on federal contracts?

Keep reading this article at: http://www.nextgov.com/cio-briefing/2013/12/reflections-2013-year-nearly-killed-one-small-federal-it-firm/76097/?oref=nextgov_cio_briefing

Federal contractors’ pain won’t vanish after shutdown ends

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The U.S. government shutdown may hurt contractors long after Congress and President Barack Obama find a way to open federal offices and resolve the debt ceiling dispute.

Federal agencies award more than $500 billion a year, or a rough average of $1.4 billion a day, to tens of thousands of contractors. With each day of the partial shutdown, the pipeline gets more clogged by late payments, halted work and canceled solicitations for new contracts. That bottleneck may affect contractors’ fourth-quarter results.

“Even if the government suddenly opens for business, we can’t expect everything to get back to normal right away,” said Larry Allen, president of Allen Federal Business Partners, a McLean, Virginia-based consulting company. “This is going to be a wave that makes its way through the government’s operational infrastructure probably at least until the end of the calendar year.”

If the shutdown continues through the end of the week, it will be difficult for big contractors to make up for lost revenue before the end of the year, said Michael Lewis, managing director at McLean, Virginia-based Silverline Group LLC, a strategic consulting firm for aerospace and defense.

Keep reading this article at: http://www.bloomberg.com/news/2013-10-09/federal-contractors-pain-won-t-vanish-after-shutdown-end.html.

More contractors see decline in federal revenue

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For the first time in a long time, more federal contractors reported decreases in their government contracting revenue last fiscal year than those who saw increases, according to a Grant Thornton survey of about 100 contractors.

Thirty-eight percent of contractors suffered reductions in revenue over the past year, compared with 36 percent that saw revenue increases and 26 percent that experienced no significant change, according to the annual Government Contractor Survey released last week. Professional Services Council sponsored the survey.

“This year’s survey shows more revenue shrinkage than growth and a plunge in net profit, with the majority of contractors seeing a tiny profit or none at all,” the survey said. “This despite reducing headcount and overhead, holding wages at generally the same level as in the last two years, cutting [general and administrative expenses] and benefits, and doing just about all a company can do to sustain profits. Contractors are up against costs that can’t be slashed and must be absorbed: indirect, health care, overtime and, for many, out-of-scope work.”

Keep reading this article at: http://blogs.federaltimes.com/federal-times-blog/2013/01/24/more-contractors-see-decline-in-federal-revenue/.

Contractors find that doing business with government is increasingly risky

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Federal contracting is increasingly becoming a high risk business, according to an industry survey scheduled to be released later this month.

The survey from consultant Grant Thornton shows nearly 40 percent of federal contractors achieved lower revenues this year compared to last year while 35 percent made greater revenue, Grant Thornton Principal Lewis Crenshaw said.

In 2011, by comparison, half of government contractors reported increased revenues and about 30 percent reported a decrease, Crenshaw said during a Dec. 14, 2012 event hosted by the Association for Federal Information Resources Management. The consultant plans to release its 18th annual government contractor industry survey later this month.

Keep reading this article at: http://www.nextgov.com/cio-briefing/2012/12/federal-contracting-increasingly-risky/60190/?oref=nextgov_today_nl.

Cutting through red tape in government procurement

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Do government purchasing departments drown prospective vendors and contractors in paperwork and procedures?

“I certainly believe there is too much red tape in selling to the government, which is driving up procurement costs on lower ticket items, which is the core of our business,” Steven Bosio, president of Grand Rapids, Mich.-based MarketLab, told Industry Market Trends (IMT).  MarketLab is a direct-mail catalog supplier of specialty products and services for health care professionals.

Keep reading this article at: http://news.thomasnet.com/IMT/2012/07/10/cutting-through-red-tape-in-government-procurement/ 

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