Although the SBA is not ready to make its formal announcement yet, government-wide spending for fiscal year 2013 exceeded the 23% spending goal for small businesses for the first time in seven years. Based on data released via the Small Business Dashboard, of the $356 billion eligible dollars spent by the government in fiscal year 2013, small businesses received $83.4 billion or 23.43%. Meeting the 23% government-wide goal for 2013 is even more notable considering Bloomberg’s recent study, which showed that overall federal contract spending fell by 11% from fiscal 2012 to fiscal 2013.
Among the socio-economic set aside programs, over $30 billion went to Small and Disadvantaged Businesses (“SDB”), well over the 5% statutory goal. Spending on Service-Disabled Veteran-Owned Small Businesses (“SDVOSB”) also exceeded its 3% goal, with $12 billion or 3.38%. However, the Women-Owned Small Businesses (“WOSB”) and HUBZone programs both fell short of their statutory goals, 5% and 3%, respectively. WOSB spending in fiscal year 2013 topped $15.4 billion or 4.34%. HUBZone spending was the lowest, representing only 1.75% ($6.2 billion) of fiscal year 2013 spending.
As far as individual agency spending, the three largest spenders in actual dollars were the Department of Defense (“DOD”) ($48.4B), Department of Veterans Affairs (“VA”) ($6.6B), and the Department of Health and Human Services (“HHS”) ($4.6B). But when it comes to meeting their small business spending goal, the top performers were the Office of Personnel Management (“OPM”), General Services Administration (“GSA”), and the Department of the Interior (“DOI”). Interestingly, DOD led all agencies in actual dollars, but fell short of its 22.5% spending goal, which could be due in part to the sequester and the DOD spending down overall by nearly 15%.
Small business contractors would be well-served analyzing the spending trends of their top customers. Is the agency meeting its small business goal? Is it meeting its goal for another set-aside program in which your company participates (i.e., SDB, WOSB, SDVOSB or HUBZone)? If not, these may be helpful marketing data points to raise when you’re meeting with agency representatives.
You can also use these federal spending reports to analyze whether your business has a presence with the agencies that are spending their dollars on small businesses. For instance, the HHS was one of the top spenders in 2013 and exceeded its small business goal by over 3%. Its spending is also up from 2012, despite the sequester. If you have not yet pursued opportunities at HHS, these 2013 spending reports may give you reason to start.
About the Author: Megan Connor, an associate with PilieroMazza, focuses her practice in the areas of government contracts, small business administration programs, business and corporate law, and litigation. She may be reached at email@example.com.