WHAT IS THE 8(A) PROGRAM AND WHAT ADVANTAGES DOES IT OFFER TO POTENTIAL BUSINESSES CERTIFIED UNDER THIS PROGRAM ?
The SBA administers two particular business assistance programs for small disadvantaged businesses. These programs are the 8(a) Business Development Program and the Small Disadvantaged Business Certification Program. The 8(a) Program offers a broad scope of assistance to socially and economically disadvantaged firms whereas the SDB certification strictly pertains to benefits in federal procurement. If a firm becomes 8(a) certified, they are automatically SDB certified as well. But, if a firm becomes SDB certified, they are not 8(a) certified. The SBA 8(a) program is a nine year program. A firm may only be certified once under the 8(a) program. During the first 4 years of this program, firms are in a developmental stage or growth stage. For the next 5 years; firms are in a transitional stage. The 8(a) program is SBA's effort to promote equal access for socially and economically disadvantaged individuals to participate in the business sector the nation's economy. The SBA provides assistance to all small businesses. Socially and economically disadvantaged individuals represent a significant percentage of U.S. citizens, and, yet, account for a disproportionately small percentage of total U.S. business revenues. The program recognizes the historical lack of equal access that minorities and other disadvantaged individuals have had to the resources needed to develop their small businesses. This program assists 8 (a) approved firms to participate in the business sector and to become independently competitive in the marketplace.
WHAT ARE BENEFITS OF A FIRM BEING 8(A) CERTIFIED ?
1. BUSINESS DEVELOPMENT ASSISTANCE A Business Opportunity Specialist ( BOS ) from the SBA will be assigned to each firm once they have become 8 (a) certified. This person is responsible for providing the 8(a) firm with access 'to assistance that can help the firm fulfill its business goals. The BOS counselor can provide access to assistance in the following areas: A - Procurement B - Marketing C - Financial D - Management E - Surety Bonding (this is particularly important to those in the construction field)
2. GOVERNMENT CONTRACT OPPORTUNITIES The SBA undertakes an extensive effort to provide contracting opportunities to those businesses certified under their 8(a) program. The SBA maintains close contact with various federal agencies to keep government personnel informed of the 8(a) program goals and procedures and to request that contract opportunities be reserved for the 8(a) program. In fact, there are some federal contracts that are set aside so that only 8(a) certified or SDB certified firms can bid on them. There are other cases where federal contracts are awarded to 8(a) firms without being put out for open bidding. These are called sole source contracts. It is imperative that 8(a) certified firms conduct independent marketing activities for contract opportunities both in the public and private sector. When a 8(a) firm soliciting business with U.S. government departments and agencies identifies contractual opportunities, it may attempt to convince the federal department or agency that it is qualified to undertake the work, and that the firm's name should be sumitted to the SBA as the recommended contractor. The SBA does not and can not guarantee any specific amou/it of government business for each 8(a) firm.
3. MAJOR BUSINESS SUPPORT The goal of the 8(a) program is to support and assist small businesses to develop to the point that they can compete successfully in the marketplace without government assistance. To reach this goal, the SBA encourages and assists 8(a) businesses by referral or other methods to enter into contracts with major businesses. To achieve this goal, the SBA uses several tools:
A - Pro-Net(Procurement Marketing and Access Network) Each 8(a) business is registered in Pro-Net which is used by major business and government procurement officials to identify small businesses capable of providing required goods and services. B - Direct Marketing The SBA undertakes activities designed to promote businesses relationships between 8(a) businesses and major businesses. These activities include (1) establishing preliminary contact with major businesses on behalf of the 8(a) firm and (2) providing necessary follow-up assistance to the 8(a) firm in the development of this relationship.
C - Indirect Marketing Through SBA Specialists in Contact with Major Business- SBA officials maintain contact with representatives of major businesses and inform these representatives of the capabilities of the 8 (a) businesses in their various fields of endeavor.
D - Self-Marketing with Support and Guidance from SBA Specialists- The SBA encourages 8(a) firms to market their products or services directly with major businesses. The SBA Business Opportunity Specialist can arrange for counseling on effective sales presentations and in any management or technical area that would enhance the firms ability to market their product or service.
"All of the above information, for the most part, has been obtained from an ABA 8(a) informational brochure offered for distribution to the general public, and marked "document 2 02/06/98"
WHAT IS THE SDB PROGRAM AND WHAT ADVANTAGES DOES IT OFFER TO POTENTIAL BUSINESSES CERTIFIED UNDER THIS PROGRAM ?
The SBA administers two particular business assistance programs for small disadvantaged businesses. These programs are the 8(a) Business Development Program and the Small Disadvantaged Business ( SDB ) Program. SDB certification strictly pertains to benefits in federal procurement. The SBA certifies SDBs to make them eligible for special bidding benefits when federal contracts are first put out for bidding.
BENEFITS OF SDB CERTIFICATION :-
1. Under the government's reformed affirmative action rules, SDB certified firms are eligible for price evaluation adjustments of up to 10% when bidding on federal contracts in certain industries.
2. The program also provides evaluation credits for prime contractors who achieve SDB subcontracting targets. The program is intended to help federal agencies achieve the government-wide goal of 5% SDB participation in prime contracting. The price evaluation credits are authorized in those NAICS (originally, they were the SIC codes) industry categories where the US Department of Commerce has determined that SDBS' are underrepresented because of the effects of ongoing discrimination. As of 10/1/98, SDBs are eligible to receive the credit when competing in the following industry categories: Agriculture Fishing Forestry Construction Mining Manufacturing Transportation Communication Services: Electric Gas Sanitary services Wholesale Trade Retail trade Finance Insurance Real estate services
3. Effective 1/1/99, negotiated contracts where SDB participation is an evaluation factor can provide monetary incentives for prime contractors that meet specified targets for SDB -subcontracting in the NAICS major groups. The US Department of Commerce" benchmarks" reflect the degree of SDB under- representation in each industry category. The price credit is not available for industry categories where benchmarks are not required. In addition, the price credit does not apply to 1. procurements that are below the simplified acquisition threshold of $100,000; 2. procurements that are set aside for small business; 3. procurements under the SBA8(a) program.
* All of the above information has been obtained from an SBA paper/ brochure offered for distribution to the general public and dated 4/17/00; it can be found on website http://www.sbaonlme.sba.gov/sdb/section06c.htm
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