We often hear about companies in year 5 (or later) of their 9-year 8(a) BD program term voluntarily withdraw from the program and/or express unhappiness with the program because they haven't yet received an 8(a) contract. More often than not, this situation is a result of a misconception on the firm's part that once in the 8(a) program, Federal contracts will just miraculously fall into their lap. The reality is that getting an 8(a) sole-source contract requires a lot of time and effort on the part of the 8(a) firm. This blog post will provide a general overview of the various paths to an 8(a) sole-source award.
1) 8(a) Firm Self-Markets Itself To the Agency
Now, as will be discussed below, there are certainly situations where the 8(a) firm may have to do very little in order to get an 8(a) contract; however, those situations are rare. In reality, companies that are serious about getting 8(a) contracts know that they have to obtain past performance, they have to get out there and form relationships, and they have to self-market to agencies. The diagram below illustrates the process, but it can generally be described as follows:
What many companies have a difficult time understanding is that this process takes time. In fact, it can take years. At a conference we attended last year, the NASA small business representative noted that their agency has been tracking length of time between initial contact with a firm and if/when the firm might get a contract and that it usually takes approximately 18 - 24 months. Thus, it is highly recommended that firms take the time to do market research and do some self-marketing prior to applying to the 8(a) program so that they don't eat into their 9-year program term.
Now, as will be discussed below, there are certainly situations where the 8(a) firm may have to do very little in order to get an 8(a) contract; however, those situations are rare. In reality, companies that are serious about getting 8(a) contracts know that they have to obtain past performance, they have to get out there and form relationships, and they have to self-market to agencies. The diagram below illustrates the process, but it can generally be described as follows:
- The 8(a) firm markets itself to the agency - This requires the firm to: (1) have a solid understanding of what the agency's purchasing needs through market research; (2) understanding how the agency procures its requirements; (3) knowing who the correct points of contact within the agency are and how to reach them; (4) being able to articulate how the firm is qualified how the firm will be able to meet the agency's needs and assist the agency in meeting its mission(s).
- The agency sends an Offer Letter to the SBA - In the event your self-marketing efforts are successful and the agency decides it would like proceed with a sole-source award to your firm, the agency will send an Offer Letter to the SBA which contains very specific information (a later blog post will cover the contents of the Offer Letter).
- The SBA certifies the 8(a) firm's eligibility - Upon receipt and review of an Offer Letter, the SBA will then make a determination as to the firm's eligibility and forward that to the agency.
- The SBA sends an acceptance letter to the agency - In the event the firm is determined eligible and there are otherwise no issues, the SBA will send an acceptance letter to the agency. It is then up to the agency and the firm to negotiate the contract.
What many companies have a difficult time understanding is that this process takes time. In fact, it can take years. At a conference we attended last year, the NASA small business representative noted that their agency has been tracking length of time between initial contact with a firm and if/when the firm might get a contract and that it usually takes approximately 18 - 24 months. Thus, it is highly recommended that firms take the time to do market research and do some self-marketing prior to applying to the 8(a) program so that they don't eat into their 9-year program term.
2) SBA Requirements Search Letter
Another method of obtaining an 8(a) sole-source award can occur where either: (1) your firm learns about a requirement that it believes it is qualified for and can perform and requests that the SBA send the agency a Requirements Search Letter that requests the agency to consider your firm for the award; or (2) the SBA becomes aware of an eligible procurement and contacts your firm to discuss possible interest and if there is interest, the SBA will send out a Requirements Search Letter on the firm's behalf.
3) Agency Unilaterally Offers the Requirement to the SBA
Now, there are situations where an agency has done its own market research and through this research has come across your firm. They may reach out to your firm and inquire as to level of interest and ability to perform the contract. In the event that both parties want to move forward, the agency could unilaterally offer the requirement to the SBA with the intent of having your firm be awarded the contract. Under this scenario, the process would be the same as if your firm had self-marketed to directly to the agency.
A less common method of obtaining an 8(a) sole-source award occurs when an agency unilaterally offers a requirement to the SBA without a specific firm in mind. The SBA District Office may then review its portfolio of 8(a) firms and reach out to those that have the capability and experience to perform the specific requirement. In addition, if a contract is already in the 8(a) program as a sole-source award but the incumbent is no longer eligible for the contract and/or there is no other firm in mind, here again the SBA may review its portfolio and reach out to eligible firms.
This blog post is simply intended to provide readers with a general overview of the ways in which an 8(a) sole-source contract is awarded and is not intended to provide an exhaustive list of all the various scenarios that can occur. If you have any questions about the 8(a) program or sole-source awards, please contact us at info@holomuaconsulting.com.
Another method of obtaining an 8(a) sole-source award can occur where either: (1) your firm learns about a requirement that it believes it is qualified for and can perform and requests that the SBA send the agency a Requirements Search Letter that requests the agency to consider your firm for the award; or (2) the SBA becomes aware of an eligible procurement and contacts your firm to discuss possible interest and if there is interest, the SBA will send out a Requirements Search Letter on the firm's behalf.
3) Agency Unilaterally Offers the Requirement to the SBA
Now, there are situations where an agency has done its own market research and through this research has come across your firm. They may reach out to your firm and inquire as to level of interest and ability to perform the contract. In the event that both parties want to move forward, the agency could unilaterally offer the requirement to the SBA with the intent of having your firm be awarded the contract. Under this scenario, the process would be the same as if your firm had self-marketed to directly to the agency.
A less common method of obtaining an 8(a) sole-source award occurs when an agency unilaterally offers a requirement to the SBA without a specific firm in mind. The SBA District Office may then review its portfolio of 8(a) firms and reach out to those that have the capability and experience to perform the specific requirement. In addition, if a contract is already in the 8(a) program as a sole-source award but the incumbent is no longer eligible for the contract and/or there is no other firm in mind, here again the SBA may review its portfolio and reach out to eligible firms.
This blog post is simply intended to provide readers with a general overview of the ways in which an 8(a) sole-source contract is awarded and is not intended to provide an exhaustive list of all the various scenarios that can occur. If you have any questions about the 8(a) program or sole-source awards, please contact us at info@holomuaconsulting.com.
