Industry Market Trends
Expert's Corner: Winning Contracts for Veteran-Owned Businesses
November 13, 2012
Do veteran-owned businesses and service-disabled veteran-owned small businesses have the tools they need to win government contracts and sell their products to government agencies? How is 2013 shaping up for veteran-owned companies? GovPro.com's Michael Keating answers these and other questions in the latest Expert's Corner. Veteran-owned businesses (VOBs) are an important part of the U.S. economy. About nine percent of all U.S. non-farm businesses are majority-owned by veterans, according to the U.S. Census Bureau. Veteran-owned firms comprised an estimated 2.4 million of the 27.1 million non-farm businesses polled in the latest nationwide Survey of Business Owners. Reston, Va.-based EmeSec is a service-disabled veteran-owned small business (SDVOSB) that has found success in winning government contracts. The firm provides cybersecurity solutions to the government, and counts the Department of Veterans Affairs, U.S. Department of Labor, Federal Aviation Administration and other federal agencies among its customers. "Cybersecurity has become a critical component of national security efforts, and at EmeSec we have seen a spike in demand for forward-looking solutions and technologies," Maria Horton, CEO of EmeSec, told IMT. "It is important for other veteran-owned businesses to remain focused on growth markets as well as the investment in their own core expertise - especially in this economic climate." Horton is optimistic about business prospects for 2013: "Even in light of the anticipated budget cuts, the federal government will likely have an increased demand for cybersecurity services. How those services are innovatively implemented will be one aspect of the competitive environment in 2013. We anticipate stiff competition for new contracts as more and more companies of all sizes are entering this space - [they are] looking for a safe haven from potential revenue losses and limited funding in other professional services areas." For VOBs that are just starting to try to land government contracts, Horton offers this advice: "Focus, focus, focus. With the government's limited budget, technologies and solutions that allow agencies to make the most of what they currently have will remain a priority. Whether it's cloud services, mobility, human capital management - it's important to focus on addressing agencies' most critical needs, and on building unique capabilities that will differentiate you from the competition." More legislation is need to ensure that VOBs get their fair share of government contracts, said Wayne M. Gatewood, Jr., president and CEO of Landover, Md.-based Quality Support, Inc. The company is a 23-year-old administrative, management, logistics and technical services firm that operates as an SDVOSB. The company has won federal contracts through SDVOSB set-aside competition; one of the contracts is valued at $37 million. Gatewood, who owns the business, is a retired U.S. Marine and Vietnam veteran. Public Law 106-50, which established the Veterans Small Business Program in 1999, created a 3 percent set-aside procurement goal for federal government agencies and large prime contractors. "Since the birth of the SDVOSB Program, the same federal government agencies along with their large prime vendors have yet to attain their requisite 3 percent set-aside goals for SDVOSBs," Gatewood told IMT. Congress should pass and/or bolster existing laws to hold procurement executives accountable for such failings, Gatewood explained. "Likewise, large vendors should be fined, lose option years and not be eligible for future contracts with a given agency unless they show a marked improvement in their outreach efforts to SDVOSBs and an increase in the percentage of SDVOSDBs that receive subcontracts," Gatewood added. Gatewood sees uncertainty for VOBs looking to land government business in 2013: "If sequestration does, in fact, take place, I fear that both large and small federal government contracting businesses will be negatively affected. As budgets are reduced and programs cut across the federal government, there will be less work to go around." Amber Peebles, owner of Dumfries, Va.-based Athena Construction Group, also sees uncertainty in the 2013 business outlook. "It's difficult to predict [next year's government business], given our current federal deficit and need to rein in government spending. However, our work on the books for 2013 is solid," Peebles said. Athena Construction is a general contractor and construction management company that was founded in 2003. Today, 90 percent of the company's revenues are generated through government contracts, and 2012 revenues are projected to increase roughly 23 percent over 2011. Peebles is a former Marine. Peebles believes that programs currently in place to assist VOBs need to be better enforced and properly administered. "A huge threat to SDVOBs is the [U.S. Department of Veterans Affair's (VA)] Center for Veterans Enterprise's inability to certify legitimate SDVOBs in an accurate and timely fashion. I am always dismayed that the veterans community consistently receives substandard treatment from this department and those that criticize the process often face retaliation." There are a number of government programs that help VOBs win government contracts. The VA Federal Supply Schedule (FSS) Service offers a training program for prospective vendors and current contractors. In the program, subject matter experts cover aspects of the proposal submission and review process for VA schedules. Live webinars, podcasts and blogs are used to reach a wider audience. Another VA site worth checking is VetBiz.gov, which assists with vendor certification and provides links to resources on doing business with the VA. Private industry is doing its part to aid veteran-owned businesses. The American Express OPEN Victory in Procurement program hosts free workshops and contractor matchmaking events throughout the U.S. Go to this link on the OPEN site to learn the basics of government contracting and how the government does business. Michael Keating is senior editor for Government Product News and a contributing editor for American City and County , both published by Penton Media Inc. His 2012 government budget forecast is available at GovPro.com; as well as the mid-year 2012 forecast and his 2013 forecast for government spending. Go here for his IMT 2012 report on how to land government business. Keating has written articles on the government market for more than 100 publications, including USA Today, Sanitary Maintenance, IndustryWeek and the Costco Connection. Michael can be reached through his website, MikeKeat.net.