As we celebrate Women’s History Month we wanted to take a moment to highlight one of the biggest advantages Women-Owned Small Businesses (WOSBs) and Economically Disadvantaged Women-Owned Small Businesses (EDWOSBs) have in federal government contracting: Sole Sourcing.
In 2011, the WOSB Federal Contract Program was implemented with the purpose of increasing equal opportunity for WOSBs and EDWOSBs. Under this program, federal contracting to women owned businesses is encouraged by authorizing contracting officers to set aside certain federal contracts for WOSBs and EDWOSBs in certain industries where these types of concerns are “substantially underrepresented” (for WOSBs) or “underrepresented” (for EDWOSBs). However, it took until 2015 before the program opened up to for sole sourcing (no-bid contracts).
What is Sole Sourcing?
An award of a government opportunity through a Sole Source designation is hugely valuable because it means that after conducting market research the agency has determined that your company offers a unique solution at a value that cannot be matched by competitors and therefore the government doesn’t need to compete the opportunity. (There’s a little more to it than that, see the paragraph below, but that’s the basic premise). The WOSB and EDWOSB opening up to sole sourcing meant that WOSBs and EDWOSBs finally were authorized to be awarded sole source contracts, something that SBA’s other socio-economic contracting programs, such as 8(a), SDVOSB and HUBZone concerns, had been authorized to, for years.
Per this final rule established by the U.S. Small Business Administration (SBA), contracting officers are allowed to award sole source awards to WOSBs or EDWOSBs under appropriate circumstances. Essentially if, after conducting market research in an industry where a WOSB or EDWOSB set-aside is authorized, the contracting officer does not have a reasonable expectation that offers would be received from two or more WOSBs or EDWOSBs concerns but identifies one WOSB or EDWOSB that can perform at a fair and reasonable price, a contract may be awarded on a sole source basis. So if you’re a WOSB or EDWOSB be prepared to explain what sets your organization apart, if you are discussing sole sourcing with your agency buyers. Federal contracts can be set aside for WOSBs/EDWOSBs through Sole Source Authority per FAR Subpart 19.1506 if the contract:
- Is issued under a WOSB/EDWOSB eligible NAICS code
- Is valued at $6.5 million or less for manufacturing, or $4 million or less for all other contracts (including options)
- Can be awarded to the WOSB/EDWOSB at a fair and reasonable price
- The EDWOSB concern or WOSB concern has been determined to be a responsible contractor with respect to performance and,
- Is expected to have only one WOSB/EDWOSB perform the work, as determined by the CO
The SBA has a full list of the NAICS codes designated for EDWOSB and WOSB respectively. Since sole sourcing opened up, the government has sole sourced over $61M to WOSBs and EDWOSBs with $50M going to WOSB and the reminder to EDWOSBs. Considering this sole source authority has been available for less than two years that level of participation from agencies is excellent! During the same period, (FY2016-to date) the government spent over of $500M on WOSB and EDWOSBs set-asides with top spending agencies being Department of Defense, Department of Homeland Security, Department of Commerce and Department of Agriculture.