Small Business Contracts Essential to Strategic Buying

Small businesses play a big part of NETCENTS-2. And according to the Defense Department’s overall goals, they will likely be even more prominent in the future. The DOD’s target for procurements in FY 2017 is to award at least 22 percent of small-business eligible prime contracts to small businesses. It also wants to expand subcontracting opportunities, with a goal for the year of 34 percent of all subcontracting dollars to go to small businesses.

That doesn’t mean those goals will turn directly into actual business. In FY 2016, the DOD spent more than 60 percent of the federal procurement budget eligible for small businesses. But the heat is clearly on for DOD agencies to promote small business procurement to the greatest possible extent. The Small Business Administration says it will grade the DOD in FY 2017 based in part on small businesses getting 50 percent of all prime contracting and 20 percent of the subcontracting business.

When it comes to the Air Force, in the full and open NETCENTS-2 Products category alone, 23 percent of the total obligated dollars are reserved for small business subcontractors. For NETCENTS-2 overall, if all the goals are met, small businesses could walk away with a little less than half of the total $24 billion ceiling.

For the Air Force, small businesses are vital to its goal of achieving “strategic agility” in its acquisition activities. A part of that is to drive more competition into the process and small businesses, with the accent on innovation and the ability to act fast to changing requirements, are seen as equally capable as large businesses.

This isn’t to say it has been entirely seamless when it comes to small businesses in NETCENTS-2. In the first year of the contract, says Amy Kosatka, Air Force program manager at CDW-G, there was a misunderstanding about what was and was not small business procurement. That was due to the North American Industry Classification (NAIC) codes allotted to the contract, which early in the first year of NETCENTS-2 allowed a lot of the RFQs to come out as small business set asides.

A subset of products under NETCENTS-2 automatically qualified as small business set asides, and there was confusion about what products actually qualified. “[But] through discovery with vendors and the contracting folks, we saw that a lot of the RFQs should instead have been listed as full and open,” she says, “and that carried through to year two.”

The Air Force plans to establish a successor to the NETCENTS-2 Application Services small business vehicle, which stopped taking orders at the end of FY 2013. That will be called the Small Business Enterprise Applications Solution (SBEAS). Several preliminary drafts of the RFP were published for comment earlier in 2017, and a final RFP was posted on September 28.

The goal of the new program is to “provide a wide range of Information Technology Network Centric solutions that support the IT lifecycle to include legacy operational and sustainment activities, reengineering of legacy capabilities into target architectures, environments, and infrastructures,” says the Air Force.

In what seems like a hint to the NETCENTS-2 protests, the Air Force states, “It’s important for potential SBEAS suppliers to understand the details and implications of that contested opportunity.” The Air Force has not yet revealed any planned follow-ups to NETCENTS-2.