Small Businesses are Spending More to Bid for Federal Contracts

January 17, 2017

To Keep Winning Federal Contracts, Small Businesses Say They Have to Spend More

Source: Government Executive, Charles S. Clark, January 5, 2017

Small businesses upped their efforts to bid on federal contracts, reporting a 72 percent increase in time and money devoted to winning a share of the government’s $90 billion procurement budget, according to the latest annual survey from the American Express OPEN for Government Contracting initiative.

Though overall federal contracting is down 19 percent in fiscal 2015 from fiscal 2010, the survey—completed last summer but released last month—found that, on average, small businesses spent $148,124 in time and money to bid for federal work. That’s a 72 percent increase over the past six years, and a 15 percent increase since 2013.

The most active contractors, however, are the largest, the AMEX study found. Those with 50 or more employees and $5 million or more in revenues report being more active than they were five years ago, versus 34 percent that are less active and 29 percent making the same effort as before.

“Small business contractors report that there are now fewer bidding opportunities and increased competition,” the summary said. “Nonetheless, over the past three years, nearly half of prime contract bids were successful, and two-thirds of subcontracting participation likewise yielded some contracting activity.” READ MORE….

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