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Graduation Season: Are You Ready?

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About to graduate 8(a)? Our tips include to seek out established mid-tier partners as mentors and subcontractors.

Whether or not you’re 8(a), these tips give every small federal contractor something to think about when you don’t want to be small forever.  

Just today, I was talking to a marketer for an 8(a) company that’s just about a year from graduation. “We’re very busy trying to close all the business we can,” she said.

“What’s the one big thing that would make that easier?” I asked her.

“I don’t know,” she said. “We’re just so busy. We’re focused on converting our pipeline of opportunities into projects that will sustain us after graduation.”

Hm, I thought. That’s only one revenue stream. I wonder what they’ll do when that tap runs dry.

Is your own 8(a) graduation is getting closer? You’re going to need to start building more than one pipeline. The most successful 8(a)’s are planning for graduation from the day they get into the program. Others move preparation into high gear later on. Here are some of the tactics that winners use:

Shift your business mix.

If you’re 8(a), SBA defines that mix through changing your Business Achievement Targets (BATs) to lower the percentage of business you win based on your 8(a) status. If you’re not 8(a), it still makes sense to consider how to diversify your business mix so that you don’t rely too heavily on any one customer or channel or type of contract.

Secure a place on continuing IDIQ contract vehicles.

Federal buyers use 8(a) task order or delivery order contracts, also known as IDIQ’s, to make buying easy and meet small business goals faster. In several cases, your federal customers can use those vehicles to keep buying after you graduate from a contract you won while you were 8(a).For non-8(a), there are plenty of IDIQ’s for small business that have similar post-graduation carry-over, and others that are for all business. Sell once, win many. IDIQ’s lower barriers like time, cost, and risk for your buyer and make it easier for them to say “yes.”

Audition earlier-stage 8(a) partners

Research which ones you will want to team with after graduation. As another 8(a), you’ve got significant expertise and customer knowledge that they don’t. But soon, they’ll have access to a contract vehicle that you don’t. You might need to subcontract to them if you want to keep working with some of your best customers.  Two or three years from graduation, you can be holding tryouts – working on small projects together -- to test the strengths of those partners as potential subs or primes long before you pursue a big project together.

In fact, most federal contractors need a set of trusted small business partners to access the full range of opportunities. A “research and audition” process can ensure that you always have a couple of choices for partners in each of the set-aside programs.

Seek out the mid-tier

Even when you are no longer 8(a), will your company still be small?  At that point, if you’ve got past performance, you could be an attractive partner to an established mid-tier company. That “other than small” company may have agency relationships and insights, but be too large to qualify for small business set asides.

 What will you do to start opening multiple streams of opportunity?

Fri, 05/22/2015 - 5:50pm

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