Best Government Contracting Tip: SBA 8(a) Program is a Gold Mine! (My Personal Experience)

okay so you clicked on this video you must be interested in learning about the eight a business development program that's offered through the SBA the Small Business Association in today's video I'm going to be going over an overview of the eligibility requirements as well as the many benefits that this program has to offer for anybody who's suitable and eligible to participate in the program if you're interested in finding out more about this ad program we're about to jump into it so stay tuned hey what's going on guys Derek James here with gov kid method if you're not familiar with my work I got into government contracting when I was 26 years old but my 30th birthday I was able to win 32 US federal government contracts worth more than fifteen million dollars so as I mentioned in today's video I'm going to be going over the benefits and the eligibility requirements and just a general overview of the SBA 8a program this is a program that I have worked with intimately basically the entire time that I worked for the government contractor that I started out at when I first started learning it was we were we had just started our 8a program this is it's a nine year program and what it is is it's really an incubator to get government contractors up to speed over a nine year period so that after nine years you can fully compete based off the past performance that you have developed over that incubation period now this is a program that's only eligible to small business owners that are socially economically disadvantaged also minority it plays a big role in this as well often folks that are in this program are come from Indian or African American or Asian backgrounds I'm a white guy you don't really see a white guy in the 8a program I think it's possible you know if a Caucasian person could write a case for being socially economically disadvantaged that there may be a case there but there's another number of other eligibility requirements to go along with that so I think it's best that I take you guys inside and do a screen share I'll take you directly to the SBA website and I'll talk you through some of these points that I'm gonna be touching on for the 8a program so bear with me okay welcome back so I wanted to start out from the very beginning so anybody who's watching could follow along and do the same and repeat this process so as you can see I'm in Google and I'm gonna go s b88 a program type that in I'll scroll down to what seems to be the third option here at the current time but you just want to look for the the SBA website sba.gov is always always gonna be the right website to go to so when I click that it takes me tada takes me to the 8a business development program and this is where you can find all the information that I'll be talking well most of the information I'll be talking about today I'll be sharing a little bit of my experience as well but let's get into it it says right here the 8a business development program the federal government's goal is to award at least 5% of all federal contract dollars to small disadvantaged businesses each year so again this is a program for small disadvantaged businesses they get started talking about some of the program benefits and I'll add my two cents to this as well to help provide a level playing field remember I said this is an incubator and it's a nine year period to help level the playing field for small businesses owned by socially and economically disadvantaged people or entities that's what I said the government limits competition for certain contracts to businesses that participate in the eight a business development program disadvantaged businesses in the 8a program ken number one compete for set-aside and sole source contracts in the program what does that mean that means if you're in the 8a program as of day one you can start going after contracts without competition where you essentially can bid a job that others won't be able bid and you can win it and it can be up to four million dollars without competition and that's amazing I've done this a number of times myself a half of my total awards were sole source contracts because of that as I said we were in the 8a program and I will actually show you if you stick around to the end of this video I will show you a little bit of the beginning parts of how would you go about doing doing a response or getting started with trying to get a sole source I'll give you a tidbit of my strategy of what I would do all right next bowl point get a business opportunity specialist to help navigate federal contracting okay you you probably don't know what a business opportunity specialist unless you're in this program so what is it a business opportunity specialist is a guy or gal who works for the SBA okay this is an SBA program so get this in your heads everything goes through the SBA with this there's no other agencies it's 100% through the SBA and every local SBA or you know I should say every state has the local SBA you need to find that office sometimes there's two or three offices like Washington DC but lots of states they only have one SBA office and that's the one you will have to go to so I mean that can be good or bad news you know as far as driving to it just depending on where you're located but it's totally worth it don't let that be a barrier to entry for you on this at all but this is a person you can even go to the you know here we're doing this right so why don't I just I'll keep this up let's go SBA business opportunity specialist you know what this may not be the best you I'll show you I'll show you my local I'm in Michigan it's no secret and so my SP is located in Detroit so I'll go Detroit SBA business opportunity specialist and then you can do the same for location as well so I see this SBA Michigan district office that's I believe what I want to click on where we're gonna find out I'm doing this live and then there is this office directory and this is what you want to find you want to find your office directory and I'll zoom in so you can see a little bit better and I'm looking for business opportunity specialist and I come here we go we have the lead business opportunity specialist mr. Tom Vargo I know I know Tom and then we have Katherine case as well or that's that's lead economic specialist let me see you know what tom is the only guy we have right now we had three people and two of them actually left almost right now tom is the only guy so if you were in Michigan for example and today is July 14th 2019 and you were interested in applying to the SBA Business Development Program Tom Vargo would be your business opportunity specialist okay I won't go any further with it on this I need to get back to the video but this is something that you can do to find the BOS is also what they referred to as in your area I'll leave that open next number three form joint ventures with established businesses through the SBA's mentor-protege program so I also have experience with this the SBA mentor-protege program is for businesses that have gone through the 8a program again it's a nine year program once once they graduate once the nine year ends then that company has the possibility to become a mentor Protege so when you enter the mentor Protege program as somebody is in the 8a program you eventually essentially get to joint venture and it is a it is an official joint venture that you can form with the Protege and you guys can work together to go after contracts so in essence they kind of get to use your your 8a since there's has graduated and then you get to use their past performance so when you guys can go after contracts together you have good past performance and you have an 8a vehicle and you can go after the sole source and director Awards even using this strategy which is almost overly powered you know a little opie because it's incredibly strong strategy and if you're able to team up with another company who is a mentor I highly recommend it I've seen very successful 8a companies do this it's a great way to hit the ground running and so once you you know you do this for their first couple years and then you already have your own past performance then you can start going after contracts on your own and the last point that they had here was receive management and technical assistance including business training counseling marketing assistance and high-level executive development they're referring to here any of the resources that the SBA makes available especially for folks in the 8a program they have special conferences and things like that every SBA is different so you will have to see what your local SBA has going on but that's what they're referring to there as well but again I kind of already touched on it and I don't see it here but it it this program another program benefit is that the sole source contracts that you can get you can get them awarded up to four million dollars so that is huge for a small business that is getting started out and that's four million dollars each that's not that's not that you essentially cap out at four million dollars every every Naik's code and if you know what in Xcode is NAICS code has a dollar value associated with it so as long as you don't exceed the dollar value associated with your Naik's code doing too many of these sole sources you'll be fine if you do exceed it you you lose your small business status and you become a large business and you will actually prematurely graduate from the 8a program and so you don't you don't want to do that so that they may be a conversation for another video because today we're just doing the general overview for the 8a program but that's good to know arm and it's definitely a good problem to have if you're getting so many awards that you have to start using different next codes because that's where what you would to do to put awards under so that you don't blow your size standard so we're gonna talk a little bit about the program qualifications as well the SBA website reads you must be a small business on this eligibility checklist and what they I'll go into that a little bit more you you also need to be in business for two years they're gonna want to see returns tax returns for for two years so you you can't just start a brand new business and get into the 8a program they need to see that you're serious they need to see that you are legitimate business and so you need to be able to show two years worth of returns the dollar value isn't very high that you need to show yeah I don't it's it's something over like a hundred thousand or anything like that I have been seen anything that says exactly what the dollar value is and that kind of leads me to believe like it it really just kind of depends on the SBA office that's putting it through but you want to have some receipts that go through your business to be able to show that your business has done some work commercially and personally before applying to the program and that's the most right now that I can comment on it's not a crazy amount of money that you have to run through it but there you have to have some so next be at least 51% owned and controlled by US citizens that the company does have to be owned and controlled by US citizens that are economically and socially disadvantaged so when you go through the 8a application process there's a number of questions that are going to qualify you to determine whether you're economically and socially disadvantaged and part of that comes from you know coming from an you know an ethnic background that is disadvantaged and that's typically what a lot of people are easily able to make their case on and get approved but there's a number of other questions that will be asked as well next must be owned by someone whose personal not worth is 250,000 or less and that's just it your so net worth must currently be less than 250 I think there was talks of raising it to 750 which to me seems really high and counterproductive for this program but as of today I don't believe that is the case it also must be owned by somebody whose average adjusted gross income for 3 years is 250 or less as well it also must be owned by someone with 4 million or less in assets that includes your house your vehicles anything to your name as a business owner you have to manage the day-to-day operations and also making long-term decisions in the business now how do they you know track or you know verify this well I know in the program they do make office visits sometimes more than once a year but at least every year there is a basically like an audit where they will come and visit see how things are going ask you questions it's really not that big of a deal but they do their best to keep tabs on everybody and make sure everybody is getting the most out of the program that they can so that the time is not wasted guys do not want to waste these 9 years once the clock starts ticking it is go time you you it's best that you have a plan before you even apply so that once you're in you can really hit the ground running because the the time is just so so crucial have all its principles demonstrate good character goes without saying as well as a small business owner show potential for success and be able to perform successfully on contracts they may ask for a business plan we had to do a business plan for ours and we had to update it each year in the program and that's what speaks to this last bullet point but every sba office is different everybody runs the program a little bit different the headquarters is in DC and everything supposed to be uniform but when it gets pushed out to the district offices I think there's a different flavor for each let me see what else we got here the federal government fully defines who qualifies for the 8a program including what counts as being economically and socially it in here you go so if you want to read specifically this is great link I'll open it but I'm not gonna go too far through it so it looks like they've got questions broken out and they even site the location for each so looks like a lot of really great information this may be one of the one of the bigger takeaways from this video is this link and these QA right here that's that's really really helpful so get certified as an eight a small business before you can participate in the 88th Business Development Program you must be certified so first you you get certified and then you get entered into the program so to get certified as an ad business you can go through the certified sba.gov and get your certification and you see conveniently down here there was this get certified where you can start doing that after you successfully complete your certification you should update your business profile at Sam to show contracting officers that your business is in the eighty program so Sam is your Sam gov profile if you're watching this you you may or may not have set up your Sam yet but if you're registered and certified to do business with the government that means you've set up your Sam you've established a Duns and a cage number associated with your business and you also have established your profile and the dynamic small business search that pulls from Sam as well for your business and so they're saying here you can always update your your Sam profile as your business grows and you gain new certifications and other things and so once you get certified a day you want to add that to your profile so that any contracting officers that are looking at your your profile and Sam or the dynamic small business search they can see that you're an 8a because some of them they'll just only search by 8a as a filter and that way you will start showing up in those search results instead of just being passed over for somebody who is looking you know a company that can do the type of work that your company does so that you would be a match for who is also in the 8a program and kind of lastly here for the certification is where they finally touch on your certification will last for a maximum of nine years you'll need to complete the annual review to maintain your good standing and that is that is the same thing that I was talking about the audit others there's basically a little pamphlet that you you want to have filled out that they'll send you and you'll have to update that with the previous year's tax returns you do have to do that each and every year and then basically you have that all in a folder ready for them so when they come to do the audit that's that's all ready to go for them to review and if if they say for some reason they're not coming that year whatever you would just mail it to them or you can meet with your business opportunity specialists in the office at the SBA and just give it to them any questions you guys have really need to be geared towards whoever your business opportunity specialist is once you're you know once you know you want to get into this program you need to make him or her your best friend usually the these folks are very friendly um I will admit that sometimes they're crunched on time because they have a number of other 8a businesses that they're they're working with and doing things for but it's been my experience that different at several different sba offices that they will always make time for you you just sometimes may have to be a little bit patient and other things that you do need to rush on I did have the experience that they were able to work with me on that or even have you know a different BOS in the office helped me out if another one is you know is is out sick or something like that the SBA has been relatively good to work with from my experience but just like with any government agency you know time is a factor sometimes things can be slow sometimes there is short staff so you do have to have some patience just that you're also gonna have to extend to any of your government customers that just seems to be the case with doing business with the government in and the SBA is no exception so as you scroll down here they talked a little bit about the a mentor-protege program you can read that if you want I'm not gonna touch on that too much because again this is just an overview and I did touch on this a little bit earlier the advantages to do to do so now if you did click get certified I'll just kind of show you it's just gonna take you to this this page and you're gonna have to create an account so I won't be creating an account today but you would go to it says this has just followed the follow the instructions use max that gov to access certified at sba.gov that is where you want to be that is the direction so you would create your account and then you would follow the prompts to get certified once you're certified then reach out to your your SBA and let them know that you are you know you just got certified in the 8a you want to get into the 8a program and they will basically they'll set up a meeting with you and take the reins and you'll be in very good hands so it'll be a nice soft handoff at that point so the one other thing I wanted to show you that I mention at the beginning of the video we talked about sole source contracts you know these direct award contracts that were referenced right here and what happens when I click on this competitive set-aside sole source set aside so you can read a little bit on this as well but what I'm gonna do is I'm gonna I'm gonna open a new tab and I'm gonna go to FedBizOpps and you more than likely you're familiar with this website at this point if you're not this is the the website FedBizOpps FBO gov where everybody goes to bid on the jobs this is where the jobs are posted this is entirely free create your free login account so you can set up your own searches and get emails you know as frequently as everyday as far as the new opportunities that are posted for the particular opportunities and agencies and Knicks codes and whatever criteria you want to search by that are posted every single day that way you don't have that way you don't have to go through the sea of data and find stuff randomly like I seem to love doing but I'm different so what I wanted to show you as the last part of this video as it relates to the 8a program and winning sole source contracts when you go to fbi.gov you go to Sources Sought there's three there's three main type of procurement statuses the first is a source sought the second is a pre-solicitation the third is the combined synopsis or just the solicitation also known as the RFP RFQ or the proposal stage these are sequential it starts out as a source of sought it graduates to a pre-solicitation and then finally it goes to the solicitation once all this looked at all once all the solicitations are submitted all the bids are put out there then it is essentially awarded that is the cut-and-dry three to four step process of an opportunity now there's always going to be amendments and justifications and approvals and some of these things but the the three to four including the award that I just listed is the main sequence of events so the one I want to focus on is the source of sought Sources Sought is the very first step basically you know it's the baby of an opportunity the baby was you know just born or just conceived or you know however you want to say it it's the very beginning stage of we need work done in FBO if you go to sources saw and you click search it pulls up all the source of thoughts based on my criteria it was ones that were posted today July 14th if you go to one I'm just going to click on the very first one here if you're an 8a business what you could do say that this is a an opportunity that your company can perform you want to actually bid it and you can't bid it yet because this is only market research the government contracting specialists and the officer in this case it's Stacy Massey the specialist she's just putting her feelers out there oh look another Michigan where I'm located and Arbor Michigan yep Stacy's just putting her feelers out there to see what companies would be interested in bidding this proposal once the proposal actually comes out this is not the proposal itself what you typically do is you would respond to this market research with a capability statement you answer any specific questions that they have in this case it says right here responses will include the following and here is the deadline you submit that and like I said if there's any additional questions you put that in a separate document from your capability statement a short little white paper right up you attach both of those documents in an email and you send it off so what happens when you're in when you're in the 8a program well when you're in the 8a program you can actually ask on request for a sole source direct award to Stacey Massey in your email submission you can educate her that you are a 8a small business and that this is work that you can perform and you have performed in the past possibly that only helps your case basically you want to sell yourself as much as you possibly can in this short narrow window and and if stacey is interested in doing an 8a award then she may go talk to her boss that maybe you know the the chief of contracting or it may be the small business office that she she kind of checks within the small business office at at her agency at the VA in Ann Arbor or let's see in this case in Kettering Ohio where she sits they may do a little bit of research on your company they may reach out to you and say hey we're interested in doing a direct award or sole source procurement weightier company we would like to schedule a phone call and at that point in time the conversation has begun and and you may be in for a ward if if they are interested in doing that with you all they're gonna do is they're actually gonna send you an RFP that nobody else is gonna see and you're gonna respond to it you were gonna respond to it with a full-blown proposal and you're full blown pricing and they'll likely negotiate with you they're probably gonna beat you up on your pricing depending on what type of work it is and essentially hopefully you guys agree on a price and they find that your proposal is acceptable and then the contract is awarded that's one way that it can go and all stemming from again this Sources Sought market research stage this is not during the RFP stage this is only the source of saw a second thing you can do is you can request that your sba send what's called a search letter or a requirements letter but I think they're more familiar with the term search letter if you talk to your business opportunity specialist again that person needs to be your best friend pick up the phone say hey I watch this video from Derek James he said that my SBA could send a search letter on my behalf to a contracting specialist basically vouching for my company letting them know that I can do this work for solicitation number blank and essentially the SBA will write a letter on not on behalf of your company but going to bat for your company saying the SBA is familiar with your company they are a great company they can do this work and the SBA essentially has your back in terms of you know reputation and you're able to perform and so when the contracting office receives this letter the search letter from the SBA that greatly enhances the chances that now Stacey Massey is gonna be able to go to her boss and say hey I have this email submission from XYZ company and I also have the search letter from the SBA going to bat for this company what do you think should we go sole source direct award with this contract and like I said if so that same process is gonna commence where they send you an RFP via email or maybe they set up a phone call first to get comfortable with you then you'll respond to with your full-blown proposal and your pricing and then there's the negotiation and then essentially after that the proposal the contract should be awarded so this is something that we did not know at the beginning of our 8a program it took us a few years to figure this out unfortunately I talked to 8a small business owners all the time that they don't even know that they can do this they don't know that they're SBA can send a search letter for them if you're watching this video and you're in the 8a program and you didn't know this and you have a POS pick up the phone call him or her and say hey I watched this video do you know what the heck does Derek James guys talking about Haunted percent chance they're gonna say absolutely do you have a solicitation or you know a Sources Sought notice to be correct the other Sources Sought notice in mine that you know you've responded to that's the only other thing I'll add is you need to respond to your some send your submission first number one and then have the SBA send the search letter secondary they don't want to be Stacy doesn't want to receive a search letter basically talking highly about your company before she's even received a submission from your company that's backwards and she's not gonna even know who you are what to do with it so maybe send the submission first pick up the phone and call her if you can find her phone number she don't have it listed here but there's ways to find it on Google but email is just fine if you can't because they don't always pick up the phones if you can at least you know get her to confirm that she received your your submission that's great and then you can have the SBA step in and send their search letter that is a method and a strategy that a lot of people don't know I'm sliding that into this video only if you guys are paying attention you will take advantage of this we want a number of over a million dollar contracts just from this and we didn't have to compete against any other companies and like I said and this goes up to four million I mean they can give it to you for up to four million so that's really gonna do it for this video guys I wanted to give you this little bonus at the end but I hope that you found this SBA 8a overview helpful in terms of the eligibility requirements and the benefits if you get into this program if you're already into it I really hope you take advantage of contacting your your BOS at the sba and have them start doing search letters and responses to that the sources saw its market research that your company responds to it's only gonna dramatically increase your chances of getting a sole source and you only need to get a couple of those things and then you have past performance and then that allows you to compete much more strongly against the other companies that are already established I know a lot of you guys watch and you want to win that first contract you want to get your first prime maybe you did some sub work but you want to get your first prime contract if you're in the 8a program you need to be doing this I can't stress it enough again hope this was super helpful guys if you like this videos please give it a like if you have any comments or questions about the ad business development program that I didn't cover just add that in the comments section of the video I do check and answer routinely and don't forget to hit that little subscriber notification so that when I go live on YouTube you'll get notified and you can also check me out live and ask questions live when I'm doing that so until next time guys I hope you found this video helpful and we will see you next time

Channel: Derek James

Views: 28,176

Keywords: government contracts, government contracting, fed biz opps, sam registration, cage code, duns number, 8a program, score contracts, us federal contractor registration, osdbu, prime contracts, govcon, procurement technical assistance, government contracting consultant, Government contract, sdvosb certification, hubzone certification, 8a certification, wosb certification, capability statement template, sole source justification, minority business certification, fpds

Id: 1yZuV6Ex0sI

Length: 32min 30sec (1950 seconds)

Published: Mon Jul 15 2019