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In order to promote the flow of federal procurement dollars to small businesses, federal acquisition laws require that large businesses holding contracts over $500,000 ($1 million for construction) include plans for subcontracting portions of the work to small businesses, including those owned and operated by veterans, service-disabled veterans, disadvantaged individuals, women, and HUBZone firms certified by SBA. The requirement to submit a subcontracting plan does not apply to bidders that are small businesses themselves. How well prime contractors carry out their subcontracting plans is an important evaluation criterion for contract performance. Failure to carry out subcontracting obligations can result in penalties or, at the extreme, termination for default. The use of subcontracting has grown in importance with the increased use of contract bundling. Bundling involves the aggregation of multiple purchases into a single contract award for the purpose of streamlining the acquisition process and, it is hoped, getting a better price for the government. One effect of bundling has been a relative decrease in the number of contracts reserved for or won by small businesses. With some exceptions, most contracts between $2,500 and $100,000 are reserved for small businesses. When several are bundled, however, the value of the bundled contract may exceed this small business set-aside threshold, resulting in a decrease in set-asides for small businesses. This effect is partially offset by the resulting increase in subcontracting opportunities for small businesses. There is no central clearinghouse of subcontracting opportunities. Some are posted at FedBizOpps.gov, but the best place for small businesses to inquire is with the Office of Small and Disadvantaged Business Utilization of major contracting agencies. Because prime contractors search the CCR when seeking subcontractors, registering can increase your chances of receiving subcontracting opportunities. Many prime contractors post subcontracting opportunities to SUB-Net, the SBA's Subcontracting Network. Visit http://web.sba.gov/subnet/ to search for specific subcontracting opportunities. |
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