Federal Contract to Create Boon for Veteran-Owned Businesses

Federal Contract to Create Boon for Veteran-Owned Businesses

The Veterans Technology Services Government-Wide Acquisition Contract (VETS GWAC) will provide small Service-Disabled Veteran Owned Businesses (SDVOBs) $5 billion in federal market potential and go a long way in helping agencies meet their executive mandate according to INPUT, a provider of government market intelligence. The VETS GWAC is a ten-year set-aside contract, managed by the General Services Administration (GSA), designed to strengthen federal information technology (IT) contracting opportunities for small SDVOBs, a group that, to date, has experienced a relative deficit of federal business.

The VETS GWAC offers advantages to SDVOBs by providing opportunities to compete against a smaller group of contract holders, allowing self-marketing and a chance to develop their business before moving into larger acquisition environments. The VETS GWAC provides federal agencies pre-qualified industry partners in one easy-to-use contract vehicle and will help them meet their SDVOB contracting goals of three percent of federal spending. "Currently, SDVOBs are receiving less than half of one percent of all federal spending," said Ashlea Higgs, manager, vendor information products at INPUT. "Well-positioned small and mid-sized services companies in this business class will likely see rapid growth in the next two years as the government now has an easier way to procure services from them."

INPUT estimates that SDVOBs will receive almost $3 billion in federal contract awards annually by fiscal year 2009. "The VETS GWAC will not only change the face of set-aside business within the federal market, but will potentially re-shape strategic teams and affect acquisitions and entrants in the market space, thereby impacting many more businesses than just SDVOBs," stated Higgs. "Non-SDVOB contractors will continue to jockey for prime and sub-contracting relationships with SDVOBs as they are a business class with rapidly growing clout."

With proposals for the VETS GWAC due from contractors on Thursday, June 30, 2005, SDVOBs, particularly businesses already entrenched in the government space, will benefit from this quick federal action. INPUT estimates that only 50 SDVOBs received $1 million or more in federal IT prime contract business last year, with no small SDVOBs eclipsing $40 million in total prime contract federal IT spending. "The list of likely VETS GWAC prime contractors currently engaged in the federal market is small and well-defined and the likelihood of new entrants is high given their new set-aside status," added Higgs. "While most teaming arrangements for the VETS GWAC are solidified at this stage of the game, teaming relationships can change over the life of a contract.

Participants on the new contract will have much greater exposure to government agencies and large vendors, making their partnering potential grow quickly."