The Small Business Administration would like for more small businesses to have access to federal contracts and fiscal help. They have therefore changed the definition of what a “small business” is and this is the first time this has happened in about 25 years! The Small Business Administration said they took into consideration the level of competition in various industries as well as the average size of the companies and the current economy. So if you’re a small business owner, or striving to become one, how will this change affect you? Here are a few specifics as taken directly from the SBA website:
BA’s size standards define whether a business is “small” and thus eligible for government programs and preferences reserved for “small business” concerns. What is a Small Business Concern? A small business concern is a small business that is not dominant in the field of operation for which it is bidding on a government contract, in addition to qualifying as a small business under the criteria and size standards in Title 13, Code of Federal Regulations, part 121 (13 CFR 121). Size standards have been established for types of economic activity, or industry, generally under the North American Industry Classification System (NAICS).
This is just a snippet of the definition of a “small business” more information can be found by visiting http://sba.gov. The SBA said the goal of this new definition was to make federal contracts and funding available to more small businesses, while at the same time providing a larger selection of contractors to choose from; however many small business owners will now have to compete with those who are much larger than they are and that have more man power and resources they they do. This may be detrimental when smaller businesses are bidding on and trying to garner government contracts. I hope this has been helpful to current and potential small business owners. I’d like to know what you think about this; feel free to comment in the space below.
This is Shilonda Downing, signing off for Virtual Work Team LLC!
For the majority of businesses that have about nine to 11 employees, it’s hard to compete against a company that has 500 employees.”