WOSBs Getting Their Contracting Groove On?

How are women business owners doing in the federal procurement marketplace? According to a new report, authored by Womenable for the American Express OPEN for Government Contracts program, the answer is “increasingly well.” Even though, on average, women business owners who are active federal contractors have been seeking contracts for less time than their male counterparts, they are every bit as successful in terms of overall revenue and employment, and are rapidly catching up in terms of federal contract award value.

pot_o_goldOne reason for their growing success may be the increased traction of the Women-Owned Small Business (WOSB) Procurement Program, established in 2011. Two years ago, just over one-third (37%) of women business owners who had self-certified as a woman-owned small business (WOSB) found that designation to be useful in seeking contracting opportunities. Now, a 67% majority of WOSBs find the designation useful, including 28% who find it very or extremely useful.

Other key findings from the report include:

  • In each of the three American Express OPEN for Government Contracts surveys, women-owned firms have been found to invest less time and money researching opportunities and submitting proposals for federal contracts. In 2012, women-owned firms spent $112,112 pursuing federal contracts, compared to the $137,040 investment made by men-owned firms;
  • The average investment made by small businesses in seeking federal contracts has, however, risen dramatically over the past three years, with a greater than average increase seen among women-owned firms (up 59% compared to a 49% increase among all small contractors);
  • While women invest less time and money seeking federal contracts, their prime and sub-contracting bidding activity and success rates match the average for all active small firm contractors; and
  • On average, it takes a small business new to the federal procurement marketplace about two years (24 months) and 4.7 unsuccessful bids before winning that all-important first contract. It took women business owners less time and effort (20 months and 4.3 unsuccessful bids) to land their first contract compared to their male counterparts (25 months and 5.0 unsuccessful bids).

So, while selling goods and services to federal agencies may not be the “pot of gold at the end of the rainbow,” for many small businesses – including an increasing number owned by women – federal procurement is an important avenue to business growth.

You may download and read the report, “Women-Owned Small Businesses in Federal Procurement: Building Momentum, Reaping Rewards,” at the highlighted link. This report is the second in a series of four reports. The first, “Trends in Federal Contracting for Small Businesses,” may also be downloaded and read. The other two reports, the next focused on trends in federal contracting among minority business owners and the final, taking a look at how small business owners are utilizing subcontracting and teaming to achieve procurement success, are forthcoming.

Progress for Women in Federal Procurement? Not So Much …

As we womenablers know, after a very long battle, a  Women-Owned Small Business Procurement program was launched by the US Small Business Administration in February 2011. How’s that program faring nearly 18 months later? Well…

First of all, there’s been no official commentary or updates from the SBA since the program was launched. Secondly, a recent analysis in an article on Bloomberg.com finds that just $21 million has been awarded through the new program – less than the cost of one unmanned drone. WIPP Lobbyist Ann Sullivan, quoted in the article, puts it well:

“We worked for 11 years to try and get this thing in place. Is the program working? Well, looking at those numbers, the answer is no, it’s not working.”

OK, womenablers, time to put the pressure on the SBA – and on all federal agency purchasing offices – to start utilizing this program!

For advocacy fodder, you might want to download and read these two reports looking at the performance of women-owned firms in the federal contracting arena:

These research reports show that once women-owned firms start winning federal contracts, their success and business size matches their male peers – proving they are up to the task and that access to government markets can level the playing field of business achievement.

Navigating the Federal Procurement Maze Pays Off for Many Women Entrepreneurs

Accessing new markets is an important avenue for business growth for all businesses, large and small. For many women business owners, federal agencies provide an excellent opportunity for market expansion and business growth. As many are aware, the U.S. government is the world’s largest single purchaser of goods and services, spending just over $535 billion in external contracts in fiscal year 2011. And with a 5% federal spending goal for agency spending with women-owned firms, and a newly-implemented Women-Owned Small Business Procurement Program, federal procurement is a market ripe for expansion by growth-oriented women entrepreneurs.

recent survey conducted among women and men small business owners who are active federal contractors1 shows that women-owned firms that are active in federal contracting have achieved the same level of business and procurement success as their male peers A new report from this second annual survey, Women and Minority Small Business Contractors: Divergent Paths to Equal Success, focuses on key trends among women- and minority-owned firms in federal contracting. This report, published by American Express OPEN’s Victory in Procurement (VIP) program, finds that while business and procurement achievements do not vary by gender, procurement strategies do vary, as do success rates.

Notable survey findings include:

  • Women-owned active contractors have achieved the same level of procurement and business success as all active small contractors. Over one-third (35%) of women active contractors have received $1 million or more in federal contracts to date, statistically identical to the 38% of all active contractors who have reached the same level of procurement success. In addition, 19% of women contractors employ 50 or more workers and 42% have $1 million or more in annual revenues, virtually the same as the 18% and 47% seen among all active small business contractors.
  • Investments made in seeking contract opportunities have risen over the past year, but remain lower for women. On average, active contractors invested $103,827 in staff and financial resources seeking federal contracting opportunities during 2010. During that same period, women contractors spent 17% less —a total of $86,643. Both generally and among women, however, procurement investments are up this year over last — 23% among women and 21% overall.
  • Women business owners are more likely than average to have obtained a special designation or certification. Over eight in 10 (82%) of women-owned firms have one or more of these designations, compared to 70% of all active contractors. The most helpful certifications for women are getting on the GSA Schedule (24% are on the schedule, 41% of them have found it very or extremely useful) or taking advantage of veteran or disabled veteran status (less than 10% of women-owned firms have these designations, but nearly 40% of those who do have found it to be very or extremely useful to them).
  • Bidding activity and contracting success rates have declined, more so for women than the average small business contractor. Comparing the most recent three-year contracting period (2008-10) with the previous period (2007-09) finds that the number of prime contract bids and participation in bids as a subcontractor are down: 47% for prime contracts and 48% for subcontracts. Among women-owned firms, there has been a 55% decline in prime contract bids and a 30% decline in subcontracting participation. Success rates have also declined: down 8% among all firms and 17% among women for prime contract wins, and -27% and -34%, respectively, for subcontract wins.

Finally, it’s interesting to note that women business owners do not yet find the women-owned firm designation to be very helpful to them in obtaining federal government contracts. However, as this survey was taken, the WOSB Procurement Program was just getting underway. Tracking the improvements that program will have on the number and value of federal contracts going to women-owned firms will be f great interest to the women business owner community.

This report is the second in a series of four reports that will be published from the second annual survey among active small business federal contractors. The first, Trends in Federal Contracting for Small Businesses, focused on the overall situation for small firms in the federal marketplace today as well as key trends seen over the past year. Other upcoming reports will focus on how strategies and outcomes change with level of procurement experience, and what lessons can be shared from firms that focus on subcontracting as a procurement strategy. To download and read the entire 11-page report click here, and to learn more about American Express OPEN’s VIP program, visit www.openforum.com/governmentcontracting.

A separate Womenable-authored blogpost focusing on the findings from the perspective of minority-owned businesses can be found on OPENforum.com.

1 An active contractor is defined as a business that is registered on the Central Contractor Registry to do business with federal agencies and is either currently performing on a federal contract or has performed on a contract within the past five years.

Growing into New Markets: The Power of Procurement

After a decades-long battle, a Women-Owned Small Business Federal Contract Program is now in place at the US Small Business Administration. Truth be told, the 10-year fight to get the law calling for this program implemented was just the tip of the iceberg. Way back when women business owners and their organizations (NAWBO and AWED (now defunct) chief among them) fought for the passage of the Women’s Business Ownership Act of 1988, they tried to get language inserted referring to access to government contracting programs, but were told that it would sink the entire bill if it were to be inserted – so it was left out.

In the mid 1990’s, then, a 5% goal was established, requesting but not requiring federal agencies to target at least 5% of their spending with women-owned small businesses. Well, as we womenablers know, that goal has never been reached on a government-wide basis – due in large part to the “big kahuna” status of Defense Department spending. In actuality, as of fiscal year 2008 year, 14 federal agencies spent more than 5% with women-owned firms. (Read more about it in this fact sheet from the National Women’s Business Council.) Kudos to them!

And kudos to everyone who kept the pressure on, especially during the stonewalling years of the Bush Administration, to see the day come – February 4, 2011 – when the program was finally put in place. It’s still early days, as they say, but hundreds of women business owners and other womenablers gathered on March 2 to raise a glass to the program’s success. Thanks, WIPP, for throwing the party!

Anyway, we’re writing today in the wake of these positive developments to share some information that was gathered – by Womenable for American Express OPEN’s Victory in Procurement for Small Business initiative – to better understand how women and men small business owners are faring in the federal procurement marketplace. There are three reports publicly available that have come from this research:

What do these reports show – especially about women business owners? Here are some key findings:

  • It takes time and money to get into the federal procurement marketplace – 20 months of trying for the first contract win and an average $86,000 annual investment – but it took women business owners no longer, and a somewhat lower annual investment, to be successful;
  • Once they have become active federal contractors, women match their peers with respect to their business’ size and the total value of the contracts they’ve won to date;
  • However, both women and minority business owners are much more likely to be left at the starting gate. While 28% of active contractors are women and 24% are firms owned by persons of color (close to the national average among all firms), fully 39% of inactive contractors (defined as firms that are registered on CCR but that have either never performed or are not currently performing on a federal contract) are women and 48% are minorities.

We hope you’ll take a few minutes and read through one or all of these reports – and take advantage of the programs that are out there to help you break into the federal procurement marketplace, including:

The Most Womenabling News of 2010

In our year-end e-newsletter, rather than summarizing the latest womenabling news and providing womenablers everywhere with insights to educate, enlighten and empower your efforts, we’re ending the year by compiling what we feel are the most interesting and relevant activities that have taken place in the field of women’s enterprise development in 2010. Repeated here, and in no particular order, are what we see as the ten most noteworthy trends and events of the year:

  1. The establishment of UN Women: It’s been talked about and touted for a number of years, and this year it finally happened: the merging of heretofore disparate UN activities for and about women into one “super agency” for women: the “UN Entity for Gender Equality and the Empowerment of Women,”  otherwise known as UN Women. This entity will oversee efforts formerly under the purview of the UN’s Division for the Advancement of Women (DAW), International Research and Training Institute for the Advancement of Women (INSTRAW), Office of the Special Adviser on Gender Issues and the Advancement of Women (OSAGI), and the UN Development Fund for Women (UNIFEM). Heading the new combined entity is former Chilean president Michelle Bachelet. What do you need to know about the new agency and how you can engage with it? Read this.
  2. Expansion of women’s empowerment measurements: Where does women’s economic empowerment stand? Some of the most well-known measurements of women’s empowerment include the World Economic Forum’s Global Gender Gap reports, the UN’s GDI and GEM measurements, and the OECD’s Gender, Institutions and Development Data Base. However, all of these include several other measures (including health, education and political participation) as well as economic empowerment and, with respect to the latter, focus on women as workers rather than business owners. There are the Global Entrepreneurship Monitor’s reports on women and entrepreneurship but, sadly, one has not been published since 2007. This year, though, saw the addition of two new kids on the block, and both of these indicators focus entirely on economic empowerment, and specifically on entrepreneurship. They are the Economist Intelligence Unit’s Women’s Economic Opportunity Index, and a new GenderCLIR methodology for BEE assessment from USAID/Booz Allen Hamilton.
  3. A picture’s worth a thousand words: The International Museum of Women launched a powerful online exhibition this year, Economica: Women and the Global Economy. One project within the exhibition is Picturing Power & Potential, a juried photo exhibit which proves the adage and is well worth a look. Bookmark and return to the site as they add to it in the coming year.
  4. Recognition of “The Female Factor” in some media circles, but …: The International Herald Tribune has written a number of compelling articles about women’s empowerment issues this year as a part of their series, “The Female Factor.” And Canada’s Globe and Mail launched a national conversation about Women in Power during Women’s History Month in Canada (October). Despite this nice coverage, however, a recent study, Who Makes the News? The Global Media Monitoring Report 2010, finds that women’s voices and stories – especially about economic issues – are still largely untold in the news media.
  5. Second interval review for MDGs: In 2000, at the United Nations Millennium Summit, 189 world leaders planted an ambitious flag in the ground, agreeing on eight Millennium Development Goals aimed at eliminating world poverty by 2015. (Our favorite: #3, gender equity.) A “second interval” review of the progress being made on meeting those goals was held this year, including the publication of an MDG report and the convening of an MDG summit. The bottom line? Progress is indeed being made, but in many cases is uneven, affecting some populations and not others. Here’s a report card showing some of the details. While this review shows that much remains to be done to meet the 2015 deadline, “It is not in the stars to hold our destiny, but in ourselves.” (William Shakespeare)
  6. Progress stalled for WED in UK: Last year, in our year-end top trends E-newsletter, we noted the implosion of Prowess – the UK’s key advocacy organization for women’s economic empowerment. Well, things have gone from bad to worse in the UK for women’s enterprise development with the election of a   Conservative/Liberal Democrat coalition government. As  feared/expected, one of the new government’s first acts was declaring  that Business Link and Regional Development Agencies would be phased  out, in favor of Local Enterprise Partnerships. It remains to be seen how this will impact focused/tailored business support services such as the women’s business centre pilot programme, but our guess is that it won’t be positive.
  7. A new ED and Chair for NWBC: Another issue we followed with interest last year (though it did not make our top ten list) was stalled activity at the National Women’s Business Council in the wake of the 2008 US presidential election. Well, things are starting to move once again, with the hiring of a new executive director, Dana Lewis, and the appointment of a new chair, Donna James. Filling Council seats and revving up Council activities should commence in 2011. Women’s business advocates in the US are relieved.
  8. Quinquennial census of women-owned firms in the US: Say what you will about the growing hegemony of political and economic power worldwide, the United States still rocks when it comes to measuring the number and economic power of women-owned businesses. The  2007 quinquennial economic census of women-owned firms was published this year. Womenable summarizes the key trends for you in this blogpost.
  9. Progress in procurement: Doing business with the US government is getting easier for women-owned businesses. Finally, after a ten-year wait, a women-owned business procurement program is finally going to be launched by the SBA early next year. Not content to wait for this to happen, late in 2008 Women Impacting Public Policy, with the support of American Express OPEN, launched a “Give Me 5%” initiative (which refers to the gov’t-wide spending goal for women-owned firms) to educate women business owners on how to do business with the federal government. Where do things stand with respect to meeting that 5% goal? Federal spending with women-owned firms stands at 3.7% as of FY2009, up from 2.4% a decade earlier but still well short of the goal.
  10. Making market connections: There are two new initiatives poised to help women business owners globally make significant market connections with another important customer: large corporations. First is WEConnect International, an organization that was founded in 2009 but started to get its sea legs this year with the launch of WEConnect Europe and an event in London this October. WEConnect’s goal is to make it easier for large corporations to find women-owned business suppliers and for women-owned firms to learn how to do business with large corporations. And speaking of large corporations, one of them – Coca-Cola (ranked 404 on Fortune’s Global 500 largest companies) – announced a “reach for the stars” goal at this year’s Clinton Global Initiative conference. Coke’s “5 by 20” project aims to draw 5 million women into its Micro Distribution Center program in Africa and elsewhere by the year 2020.