8(a) Business Development Program

Overview

While the 8(a) Program offers a broad scope of assistance to socially and economically disadvantaged firms, Small & Disadvantaged Business (SDB) certification strictly pertains to benefits in Federal procurement.  Companies which are 8(a) firms automatically qualify for SDB certification.

Today's 8(a) Business Development Program is strengthened and improved to be a truly effective business development vehicle.  New regulations permit 8(a) companies to form beneficial teaming partnerships and allow Federal agencies to streamline the contracting process.  New rules make it easier for non-minority firms to participate by proving their social disadvantage.  We also have implemented the new Mentor-Protégé Program to allow starting 8(a) companies to learn the ropes from experienced businesses.  Our task is to teach 8(a) and other small companies how to compete in the Federal contracting arena and how to take advantage of greater subcontracting opportunities available from large firms as the result of public-private partnerships.

The new and improved 8(a) Program has become an essential instrument for helping socially and economically disadvantaged entrepreneurs gain access to the economic mainstream of American society.  SBA has helped thousands of aspiring entrepreneurs over the years to gain a foothold in government contracting.  Participation is divided into two phases over nine years: a four-year developmental stage and a five-year transition stage.  In fiscal year 1998, more than 6,100 firms participated in the 8(a) Program and were awarded $6.4 billion in Federal contract awards.

Benefits of the Program

• Participants can receive sole-source contracts, up to a ceiling of $3 million for goods and services and $5 million for manufacturing.  While SBA helps 8(a) firms build their competitive and institutional know-how, the agency also encourages them to participate in competitive acquisitions.
• Federal acquisition policies encourage Federal agencies to award a certain percentage of their contracts to SDBs.  To speed up the award process, the SBA has signed Memorandums of Understanding (MOUs) with 25 Federal agencies allowing them to contract directly with certified 8(a) firms.
• Recent changes permit 8(a) firms to form joint ventures and teams to bid on contracts.  This enhances the ability of 8(a) firms to perform larger prime contracts and overcome the effects of contract bundling, the combining of two or more contracts together into one large contract.

Program Goals

Program goals require 8(a) firms to maintain a balance between their commercial and government business.  There is also a limit on the total dollar value of sole-source contracts that an individual participant can receive while in the program: $100 million or five times the value of its primary SIC code.  The overall program goal is to graduate firms that will go on to thrive in a competitive business environment.

To achieve this end, SBA district offices monitor and measure the progress of participants through annual reviews, business planning, and systematic evaluations. 8(a) participants may take advantage of specialized business training, counseling, marketing assistance, and high-level executive development provided by the SBA and its resource partners.  They may also be eligible for assistance in obtaining access to surplus government property and supplies, SBA-guaranteed loans, and bonding assistance.