What is Small Disadvantaged Business Procurement Mechanism?

Small Disadvantaged Business Procurement Mechanism

In federal procurement, a small and disadvantaged business is given the chance to serve government agencies by providing quality products and services. Their participation in federal acquisitions is always given emphasis. As much as possible, public procurement involving small disadvantaged companies is paid ample attention so as to further improve its system.

Funding Your Small Business

The Small Disadvantaged Business Participation Program and the Price Evaluation Adjustment Program were given focus in September 30, 1999. The matter was under the Office of Federal Procurement Policy or the OFPP. In the notice given to OFPP, FAR (Federal Acquisition Regulation) has procurement mechanisms that are meant for the Small Disadvantaged Business Program or the SDB program, specifically found in 48 CFR subparts 19.11 & 19.12. The SDB Reform Program has FAR Subparts 19.11 & 19.12 comprising the main rules in procurement. The provision of a price evaluation for eligible and qualified SDBs is discussed in FAR subpart 19.11. The small disadvantaged business procurement mechanisms are given in FAR Subpart 19.12.

The Small Disadvantaged Business Procurement Mechanisms

Small Disadvantaged Business

FAR Subpart 19.12 gives you two important mechanisms:

  1. “An evaluation factor or subfactor for evaluating the extent of participation of SDBs in performance of the contact.”
  2. “An incentive subcontracting program for exceeding SDB participation targets.”

Since the Notice in 1999 pinpointed the SIC (standard industrial classification) big business groups wherein the federal prime contracts are qualified for adjustments of 10% price evaluation in 1999. The DOC (Department of Commerce) also proposes to have new  base data and usage estimates every quarter. However, the DOC will keep an eye on the federal procurement process every year to evaluate if these benchmarks or base data and usage estimates should rather be updated more frequently.

Industries That are Qualified for the 10% Price Evaluation

The following are some of businesses that were proposed to undergo a 10% price evaluation:

  • Forestry
  • Agricultural services
  • Fishing
  • Mining
  • Construction
  • Manufacturing
  • Transportation
  • Wholesale
  • Retail
  • Services

Small Disadvantaged Business Certification

In discussing small disadvantaged business procurement mechanisms, small disadvantaged businesses are gauged as to how active they are in federal procurement. It’s highly recommended that they should have small disadvantaged business certification given by the SBA (Small Business Administration). The certification’s purpose is to eliminate discrimination in the highly competitive world of federal procurement. In the field of government procurement, the SDBs blossom in certain areas of the country. In the United States, there are only nine small disadvantaged business procurement mechanism authorized regions:

✓ Middle Atlantic:

  • New Jersey
  • New York
  • Pennsylvania

✓  East North Central:

  • Illinois
  • Indiana
  • Michigan
  • Ohio
  • Wisconsin

✓ New England:

  • Connecticut
  • Maine
  • Massachusetts
  • New Hampshire
  • Rhode Island
  • Vermont

✓  East South Central:

  • Alabama
  • Kentucky
  • Mississippi
  • Tennessee

✓  South Atlantic:

  • Delaware
  • District of Columbia
  • Florida
  • Georgia
  • Maryland
  • North Carolina
  • Puerto Rico
  • South Carolina
  • Virgin Islands
  • Virginia
  • West Virginia

✓  Pacific:

  • Alaska
  • California
  • Guam
  • Hawaii
  • Oregon
  • Washington

✓  Mountain:

  • Arizona
  • Colorado
  • Idaho
  • Montana
  • Nevada
  • New Mexico
  • Utah
  • Wyoming

✓  West South Central:

  • Arkansas
  • Louisiana
  • Oklahoma
  • Texas

✓  West North Central:

  • Iowa
  • Kansas
  • Minnesota
  • Missouri
  • Nebraska
  • North Dakota
  • South Dakota

Through small disadvantaged business procurement mechanisms, more opportunities are given to SDBs. These small disadvantaged business procurement mechanisms will certainly boost the status of SDBs in the field of government acquisitions. All that the SDB owners have to do is to comply with every single requirement set by the SBA and they’re all set to make it!

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