Recent Report on Small Business Federal Contracting Trends Encourages Persistence

Small Business Government ContractsThis past week, the American Express OPEN for Government Contracts:  Victory in Procurement (VIP) for Small Business Program released their 2011 “Trends in Federal Contracting for Small Businesses” report.  Overall, it shows that while spending is on a downward trend opportunities still exist for small businesses, especially those with contracting experience.


Here are some highlights from the report:

  • During 2011, Small Businesses spent an average of $103,827 and placed an average of 4.4 bids to win their first contract.
  • Although Small Business investment is up 21% over the previous year, bidding activity has decreased by nearly half.
  • The biggest increase in government contracting investment was made by firms with $250,000 or less in revenue, up 110% over the past year.
  • Success rates on prime contract bids are “significantly higher” for firms with 10 or more years of contracting experience (53% success rate) than those with three years of less (20% success rate).
  • 89% of active small business contractors are in goods-producing, professional/scientific/technical services and other services firms.
  • US Government contract spending is down from $541.8 billion in fiscal year 2008 to just $476.8 billion in fiscal year 2011, a 12% decrease.


With government spending expected to decline even further over the next year, small businesses will need to work even harder to win contracts.  However, the data over the last year shows that persistence and dedication will eventually pay off for small firms.  Contracting opportunities for small businesses are still available for qualified firms who are willing to put in the time and effort to build relationships and bid effectively.

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