Recently, the U.S. Small Business Administration (SBA) has begun to redefine what constitutes a small business. What will it mean for material handling distributors that are bidding on government contracts if the size requirement changes?
In examination of size standards, SBA is revising the North American Industry Classification System (NAICS) codes, which ascribe a maximum limit, either by number of employees or average annual receipts, for qualifying small businesses. (See the SBA’s Table of Small Business Size Standards). The SBA review encompasses every private sector in the U.S., calculated based on data from the 2007 County Business Patterns and the 2007 Economic Census. The most recent proposed adjustments, which would affect the professional, technical and scientific services sectors, saw many requirements double—or more.
“One of the great mysteries of life is what constitutes a small business,” says Richard Sinclair, president and CEO of Jefferds Corporation in St. Albans, WV. “It’s like the tide. It’s constantly moving and changing.”
Government contracts are extremely lucrative and ultra-competitive, spending in excess of $425 billion last year on training, service and goods. A review of size standards has the potential to send shock waves through the material handling industry. “There is no question that small businesses have an advantage,” says Sinclair. “If a project is set aside for small business and you don’t qualify, you’re out of the hunt. That’s not to say that if you do qualify you’re going to get it, but you’ll have a chance to get up to bat. If I get up to bat, I might get a hit. If I never get up to bat, I’ll never get a hit.”
To learn more about the changing SBA standards, read the entire article on The MHEDA Journal Online. http://www.themhedajournal.org/
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