Tag Archives: 8a certification

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8(a) CERTIFICATION…IT’S ALL ABOUT GAINING A COMPETITIVE ADVANTAGE

8(a) certification…It’s all about gaining a significant competitive edge in doing business, especially with the Federal government.  What is a competitive advantage?  Simply stated, it’s what differentiates your company from any or all of your competitors in a way that’s important to a prospective customer’s decision to buy your product or service versus that of your competitors.

How do other companies differentiate themselves?  There are six fundamental strategies that can be used, alone or in combination with one another.  They are:

  • Price – That is how Wal-Mart, as the low-price provider distinguishes itself.
  • Quality – This is Mercedes, BMW’s and Rolex’s claim to fame, whether real or perceived.
  • Ease of Use – Human friendliness and ergonomic design are what Microsoft software/Windows and AOL have depended upon to become national leaders.
  • Speed of Service – Next Day Blinds, and even Dominos Pizza have used this ploy in the commodity markets of window blinds and fast-food.
  • Customer Perceived Value – Such brands as Nordstrom and Publix Grocery stores are known for their “well above-average” level of service and customer relationship maintenance.
  • Different – Being unlike others is a fundamental technique used by Apple Computer, the Satellite based radio providers, HBO, BET and Univision.

How does being 8(a) certified provide you with an opportunity to differentiate you and your company?  Here are but a few of the ways:

  • Price – Being certified can mean that your prospective customer need not buy from the lowest bidder, if you demonstrate other important values to them to contract with you.
  • Quality – Being 8(a) certified can mean that your prospective customer can buy from you, if you can convince them that you are better, even though smaller than your competitors.
  • Ease of Use – Being 8(a) certified can mean that your prospective customer can avoid developing detailed procurement specifications and having to organize and conduct complex and lengthy competitive procurements, subject to “sore-loser” protests.
  • Speed of Service – Simpler procurements are faster procurements, and that means that your prospective customer can get your products or access to your services in a fraction of the time as that which is available through competitive bidding.
  • Customer Perceived Value – Being 8(a) certified can mean that you are available quicker, easier, simpler and on more personally accommodating terms to your prospective customer than most of your competitors.
  • Different – Being 8(a) certified can mean that you are unlike the remaining 99.9% of all other small businesses in the U.S. that are not certified, just because of the fact that you have this important procurement assistance tool that you can share with your prospective customer.

8(a) Certification …What Is It?

The Small Business Administration’s 8(a) Program was created in 1974 to help minority and other disadvantaged businesses to grow through a program of federal contracting preferences and set-asides. Through the program, eligible firms can be awarded federal government contracts on a sole-source or non-competitive basis. Contracts up to $6.5M for manufacturing and up to $4M for just about everything else are available to certified firms under these non-competition bases. In addition to this, 8(a) contractors will also be eligible for participation in limited competitions where their competitors will be other companies like their own and not the “big guys.”

The Federal government set aside billions in contracts for 8(a) certified firms in its fiscal year 2012. But in spite of this, many eligible minority, women and Service-Disabled Veteran-owned businesses fail to take advantage of this lucrative program because they are put off by the difficulty of the application process. Until now that was true. Cloveer’s software and services accelerate and simplify the process of small business applying and being accepted for the SBA’s 8(a) program.

Today’s 8(a) Business Development Program is strengthened and improved to be a truly effective business development vehicle. New regulations permit 8(a) companies to form beneficial teaming partnerships and allow Federal agencies to streamline the contracting process. New rules make it easier for non-minority firms to participate by proving their social disadvantage. The SBA has also implemented the new Mentor-Protégé Program to allow starting 8(a) companies to learn the ropes from experienced businesses.

The new and improved 8(a) Program has become an essential instrument for helping socially and economically disadvantaged entrepreneurs gain access to the economic mainstream of American society. Participation is divided into two phases over nine years: a four-year developmental stage and a five-year transition stage.

You see, applying for the SBA 8(a) Certification and gaining the above competitive advantages is well within your sights, need not be a waste of your time nor will it take forever either. It won’t be a waste of your money either, since Cloveer prequalifies all clients upfront.  Visit our website at www.cloveer.com or call us at 813-333-5800 to discuss your particular situation.

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The 10 Fundementals of Success for 8(a) Companies and their Presidents

1.  Keep the End in Mind, First!

2.  Develop a System for “Out-Managing” Your Competition

3.  Know Yourself, Your Company and Your Team, Intimately

4.  Be a Mentor, as Well as a Protégé

5.  Understand Your Competition, and “Out Differentiate” Them

6.  Be a Player – Join in the “Big-Guy” Games

7.  Data, Information, and Knowledge – Know the Difference, and Use These to Power Your Leadership

8.  Find and Win More Business – But First of All, “Be Picky”

9.  Problem Solve, Without Creating Losers, and Scapegoats

10.  Remember, You Get What You Pay For –Do You?

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7 out of every 10 businesses 8(a) Applications are denied by the SBA

Don’t get denied. Make sure you fully qualify for the 8(a) Program before first!

Unfortunately, many businesses try to prepare their own 8(a) application, without some sort of outside assistance, when a quick call to Cloveer could have saved them countless hours of of wasted time they spent putting together their application and the hassle of being denied by the SBA, causing a 1 year delay for re-application.

Here are just a few of issues we see on a daily basis that applicants are not aware of:

1. The applicant firm is earning more than 70% of its revenue with one single client causing economic dependence by the SBA.

2. The applicant has ownership in another business, resulting in a less than full-time devotion to the applicant business determination by the SBA.

3. The applicant firm has a potential affiliation with another firm resulting in the SBA requiring a size determination analysis, possible resulting in the business losing their small business size status.

At Cloveer, we conduct a free detailed pre-qualification interview with all of our clients.  We ask our clients the “Killer” questions that will let them know if they have an eligibility issue, unknown to them. The fact is that there are ways around a lot of the 8(a) eligibility issues.  We advise our clients on the pros and cons to any potential 8(a) eligibility issue and tell them when there is one that has no workarounds.

As you can see from our blog and website, www.cloveer.com, we provide more information about the 8(a) Program that all of our competitors. We want you every client to learn as much information about the SBA 8(a) Program as possible since they will be the one participating and using it as one of the tools to becoming a success. The more you know, the better decisions you can make before you apply and while you are in the 8(a) Program.

For more information on the 8(a) Program, please visit us at www.cloveer.com or call us at 813-333-5800.

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How to get 8(a) Certified if your firm has been in business for less than two years.

The SBA may waive the 2 year requirement if you meet each of the following conditions:

Condition 1: The individual or individuals upon whom eligibility is based have substantial business management experience.

In order to prove that the applicant and other key individuals of the business concern meet this condition, the individual or individuals resumes and past employment history must exhibit significant management experience either;

a. previously employed performing management duties (VP, CFO, President, Director) with a firm that operated in the primary industry or NAICS code  that the business concern is seeking 8(a) Certification for, or;

b. has owned and operating a similar business concern in the past.

In addition, the applicant and other key individuals of the business concern must also have the required technical capabilities, if required in your business situation. The applicant must also hold all requisite licenses and professional certifications within a firm who have been in business for less than two years.

Condition 2: The applicant has demonstrated technical experience to carry out its business plan with a substantial likelihood for success if admitted to the 8(a) BD program.

In order to prove that you meet this condition, you must provide evidence of a business plan or some semblance of a business plan that:

a. Details your Marketing/Sales, Products/Services, Management/Organizational/Personnel and Finance goals and demonstrated progress towards the goals you specified.

b. Outlines any unique or special technical expertise that you and your team have and how you believe it will sustain your business during its early formative years.

You must also provide copies of independent reference letters from your clients, directly addressed to the applicant, that establish successful contract performance.

Condition 3: The applicant has adequate capital to sustain the operations and carry out its business plan as a participant.

In order to prove you meet this condition, your business must have sufficient working capital. Sufficient working capital is usually defined as a minimum of 3 months worth of liquid working capital immediately available. Your business bank account (s) statements must show that you have 3 times your monthly burn rate, at a minimum. In lieu of cash, a business line of credit may be substituted.

You should also describe your general payment terms and what actions your business takes to expedite the timely collection of receivables.

Condition 4: The applicant has a record of successful performance on contracts from governmental or nongovernmental sources in its primary industry category.

In order to prove you meet this condition you must provide proof of a minimum of at least two completed contracts showing operating revenues earned in the primary industry (NAICS code) in which it is seeking 8(a) Certification. The contracts must meet the following minimum conditions:

a. Show that you billed and received a minimum of $50,000 – $100,000.

b. The contracts must be with different entities and show that not more than 70% of the total operating revenue earned is with one single entity. The 70% rule does not apply if your direct billable client is a federal, state or local government agency.

Copies of all paid invoices and business bank account statements to support the operating revenue earned and collected from the contracts will need to be provided.

If you have a potential federal client that may want to procure your products or services, should you become 8(a) certified, you should provide letters of noncommittal as additional evidence.

In addition, the SBA may require proof that the government previously procured and is likely to procure the types of products or services offered by your business. Proof can be provided in the form of fbo.gov or FPDS.gov printouts of previous procurements that have occurred and are similar in nature to your products or services offered

Condition 5: The applicant has, or can demonstrate its ability to timely obtain, the personnel, facilities, equipment, and any other requirements needed to perform contracts as a Participant.

In order to prove you meet this condition you must provide an explanation of current and future personnel requirements, facilities and equipment.

For personnel requirements you should detail the current number of employees you have, any future hiring and how you will recruit and attract additional employees including timelines for hiring and any special relationship that exist with recruiters, personnel agencies and temporary agencies.

For facilities requirements you should detail your current office space, any future locations or expansions, how you will lease or purchase new office space including any relationships that exist with local commercial real estate brokers.

For equipment requirements you should detail your current equipment owned or leased that is needed to perform on contracts, any future equipment needed along with where you will lease or purchase and how you will finance or lease the equipment needed.

If you want more information on becoming 8(a) Certified, please visit http://www.cloveer.com or call us at 813-333-5800.

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8a Certification Advantages

8a certification is a valuable marketing vehicle for socially and economically disadvantaged small businesses to access the federal government marketplace. Initially, contracting under the 8a Program may seem more difficult than other methods. However, it is no more complicated than contracting under full and open competition through the sealed bid procurement process and it presents many advantages for both the government and the 8a contractor.

Advantages to the Government

A big advantage for government procurement personnel in selecting the 8a contracting method is that the agency does not have to solicit bids and may choose a specific 8a contractor to fulfill its requirements. For sole-source requirements under the competitive thresholds, the contracting agency can identify the 8a company to perform a contract by simply naming that company in an offering letter to the SBA. Of course this does not happen by itself. The 8a firm must actively self-market with the contracting agency or be introduced to the contractor through a referral. For competitive 8a requirements, the contracting agency does not have the same ability to choose a contractor, although the competition can be limited to eligible 8a companies within a certain geographic area or participation stage.

Another advantage for the government is that they can often get what they need faster by contracting though the 8a Program. This is because competitive requirements must be synopsized in FedBizOpps and the resulting solicitation must be open on the street for a minimum of 30 days. This process for full and open competition can take several months. 8a contracts have no synopsis requirements (except for competitive 8a contracts) and contracting agencies are not required to allow 8a firms 30 days to respond to the solicitation. Therefore 8a contracts can be finalized much faster.

Advantages to the 8a Contractor

The advantages to an 8a company are great. An 8a company can obtain federal contracts on a sole-source or limited competition basis much faster than in a full and open competition. For many small businesses, the costs of preparing proposals are very prohibitive. If the contract is a sole source, the 8a firm does not have to endure the costs associated with preparing a competitive proposal and participating in subsequent rounds of discussions with the contracting agency’s contracting officer.

Once the buying agencies are aware of the advantages of the 8a process and have a good experience with your 8a firm, they will most likely prefer to extend future contracts to you. The SBA plays a role in the beginning of the contracting process by verifying and approving the requirement for the 8a company. Once the requirement is in place, the 8a company and the federal agency deal directly with each other during negotiation of the contract and during performance of the contract.

Looking for help with Getting 8a Certified?

8a Application Accelerator

For our clients who are comfortable navigating the SBA 8a application process with a little less help than most, we have conceived an easy-to-use 8a Application Accelerator. As the nation’s #1 selling 8a application completion tool, we guarantee that no other program makes the process faster or easier. This interactive, web-based program takes you step-by-step through the creation and compilation of all the documentation necessary to submit your SBA 8a certification application. Moreover, the tool shows you how to organize your 8a application in the preferred SBA format. Every item and area within your 8a application will be identified and separated using our proven method, so your SBA reviewer can find, review and approve your SBA 8a application fast.

Other Services

For clients who are too busy running their businesses to complete the application themselves, we understand you don’t have time to look over the 8a checklist and that you would rather have a group of trusted 8a program experts more involved in your application. Cloveer offers other services including an 8a Application Review, and for those who would like their entire 8a application completed and approved in record time, a full 8a Application Completion Service.

No matter which option you choose, Cloveer guarantees that no other company will work harder or faster to assist you in getting your business SBA 8a certified. We have been assisting clients to obtain their 8a certification and maintain their 8a program eligibility for over 10 years. As such, we know the SBA 8a program regulatory requirements, 8a standard operating procedures and Office of Hearings and Appeal cases that affect the 8a program better than 99.9% of anyone else out there.

At Cloveer, we believe in treating you the way we want to be treated. We go the extra mile to make sure your experience with our company is outstanding. Contact us today to discover what Cloveer can do for you.

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8a Program Eligibility – The $250,000 Adjusted Net Worth Requirement

Among the many 8a business development program eligibility requirements, the applicant for 8a Certification must have a personal adjusted net worth of less than $250,000 at the time of 8a Application Submission.

What is the definition of Adjusted Net Worth?

The algorithm used to determine Adjusted Net Worth for 8a Certification purposes is:

Adjusted Net Worth = Assets – Liabilities – [Equity in primary residence + value of ownership interest in applicant business + value of any IRA/401(k) or other retirement account that is subject to a penalty for early withdrawal]

If  the applicant is married and the asset or liability is jointly held, you split the value 50/50. If the applicant is married and lives in a community property state, you split all assets and liabilities 50/50 unless you have a transmutation or pre/post nuptial agreement that states otherwise.

How can I determine my Adjusted Worth?

You can easily determine your Adjusted Net Worth by using our online calculator.

What is required to be submitted within the 8a Application to prove the applicant’s Adjusted Net Worth?

Each applicant, and their spouse, must submit a separate SBA Form 413, Personal Financial Statement. Along with the SBA Form 413 you must also submit statements for each asset or liability supporting the amounts reported. These statements cannot be any older than 30 days at the time of 8a Application submission.

Are there any ways to reduce an applicant’s Adjusted Net Worth below the $250,000 threshold?

For more information, contact us.

*Important* You cannot transfer an asset out of the applicant’s name within two years of the time your apply for 8a Certification for less than fair market value. Doing so will result in the full amount of the asset being re attributed back to the applicant.

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DIY 8(a) Certification Usually Means Certain Denial by the SBA

As the President of Cloveer, Inc. I speak to many clients who are interested in becoming 8(a) Certified. I would say that 7 out of every 10 people I talk to do not and cannot qualify for the 8(a) Program due to the strict 8(a) Program requirements. Many of these individuals have tried to prepare their own application without some sort of outside assistance and learn the hard way via denial by the SBA.

A few of these problems range from:

1. The applicant firm earning more than 70% of its total revenues from one single commercial client.

2. The applicant having an adjusted net worth that exceeds the SBA regulatory limit that cannot be lowered without violating the SBA transfer requirements.

3. Not being able to come up the required level of information and evidence required to prove social disadvantage to having an affiliation that may cause the SBA to find an unconditional control issue.

At Cloveer, we conduct a detailed free pre-qualification interview with all of our clients before we charge any fees or start preparing their 8(a) Application.  We ask our clients the “Killer” questions that will let us and more importantly them know if they have an eligibility issue, unknown to them. The fact is that there are ways around a lot of the eligibility issues but making changes may impact them beyond their comfort zone.  We advise our clients on the pros and cons to any potential eligibility issue and tell them when there is one that has no workarounds. Our feeling is that is it better for them to know now rather than later.

As you can see from our blog and website, www.cloveer.com, we provide more information about the 8(a) Program that all of our competitors. We want you to know as much information about the SBA 8(a) Program as possible since you will be the one participating and using it as one of the tools to becoming a success. The more you know the better decisions you can make before you apply and while you are in the 8(a) Program.

For more information on the 8(a) Program, please visit us at www.cloveer.com or call us at 813-333-5800.

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Tips to select the right consultant to prepare your 8a, HUBZone, WOSB or VetBiz Application.

1. Pick up the phone. Call them and speak to the actual person who will be preparing your application. 

You should be able to call them and speak directly to the individual(s) who will be responsible for preparing your application. At Cloveer, you can call and speak to the employee who will be responsible for preparing your application. They will answer any of your questions and let you know whether or not you are eligible to become certified into one of these programs at no cost. Call us at 813-333-5800 to get your questions answered.

2. Don’t choose your consultant solely on their price for services.

The old adage is true. You get what you pay for. If it looks to good too be true, it usually is.

3. Stay away from any consultant that offers you any type of guarantee.

The FAR prohibits any federal consultant to base any fee for their services contingent on certification.

4. Ask as many questions up front as possible. See if they actually know the rules and regulations of the program you want to get certified into. They should be able to answer your eligibility questions quickly and correctly.

Cloveer pre-qualifies all of its potential clients to make sure they meet all of the regulatory requirements.

5. Check the consultants Better Business Bureau report.

If they don’t have a profile established with the BBB, are not accredited or have negative feedback, this is  a sign of potential problems. Cloveer is an A Rated BBB accredited business with zero complaints.

6. Ask them for references you can personally speak to and look for a recent track record of success.

Cloveer has real references that are published on our website.

7. Look at their website to see if they provide more than just sales information.

Cloveer.com has an extensive FAQ section along with a comprehensive blog on getting certified.

8.  Make sure that the agreement provided for services to be rendered covers everything.

All services provided by Cloveer are on a fixed price basis so there will be no hidden charges.

For More information on getting your 8a Certified, HUBZone Certified, WOSB Certified or VETBiz Certified, call us at 813-333-5800 or visit www.cloveer.com

 

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The Unknown 70% Client Threshold for 8a Certification

Economic dependence based upon the amount of revenue earned by a single client an be a show stopper for many business concerns that want to apply for 8(a) Certification.

This specific eligbility criteria is not found within the current SBA 8(a) Regulations. It is set through a court case within the SBA’s Office of Hearing and Appeals (OHA). See Faison Office Products OHA Case.

If your business concern is dependent on one commercial client for 70% or more of its revenue, earned within the last 12 months, you will not be able to get 8(a) Certified until you can establish that you are below this threshold. There is one exception to this rule. If your 70% client is the federal government.

The client is defined as your billable client. In many circumstances you may be performing the work for a federal agency but are subcontracting through a commercial prime therefore your billable client is defined as a commercial client. To assist in determing whether or not you are below or exceed the 70% threshold, download our MS Excel spreadsheet that will help in determining your percentage of dependence.

When you apply for the SBA 8(a) Program you must provide a detail listing of all contract revenue earned within the last two years. You will define the date of contract award, agency/client name, a brief description of the work performed and the total dollar value of the contract. You must also provide copies of all key contracts and invoices to support the billing of the revenue earned.

To find out if you meet all of the SBA 8(a) Program eligibility requirements, please call us at 813-333-5800 or visit http://www.cloveer.com for a Free Consultation.

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8a Certification – The Economic Disadvantage Narrative Explained

When you apply for SBA 8(a) Certification, the individual who is claiming disadvantaged status must be able to provide a narrative statement of economic disadvantage as just one of the many items to be included in their 8(a) Application.

I have spoken to countless clients who typically think this is the hardest part of their 8(a) Application and dread having to come up with, recall and reflect on how their ability to compete has been impaired due to discriminatory practices against them due to their identification as a member of their SBA designated group.

HERE IS A QUICK GUIDE TO ASSIST YOU TO UNDERSTAND WHAT THE ECONOMIC DISADVANTAGE NARRATIVE IS

____________________________________________________________________________________________________

WHAT IS THE ECONOMIC DISADVANTAGE NARRATIVE:

The Economic Disadvantage Narrative is a series of statements where you describe, in detail, your personal experiences stemming from actual or perceived prejudice or bias you have experienced. These experiences must have been occurred in American Society.

____________________________________________________________________________________________________

THE SIX AREAS:

There are six areas that the SBA requires that you consider when providing experiences of actual or perceived prejudice or bias that have affected your business life are:

1 – Bonding

2 - Credit or Financing

3 – Licenses

4 – Leases

5 -Market Restrictions

6 – Underemployment/Unemployment

Note – Some of these areas may or may not apply to your business life. If they do not, skip to the next area. Remember these important facts about what you are about to describe, (1) you must be able to describe at least one major negative experience to convince the SBA that you have subjected to unfair economic disadvantage, and (2), connect it back to your distinguishing feature, whether it is race, gender, ethnicity, handicap or culture.

The SBA will not accept the justification that you have been discriminated against because you are a small business and “can’t compete with the big guys” or your credit was not good enough to get a loan or line of credit.

____________________________________________________________________________________________________

SOME QUESTIONS TO ASK YOURSELF WITHIN THE SIX AREAS:

Bonding:

1. Have you or your company ever been denied a performance or any other type of bond needed to acquire or perform your work?

2. Was the level of bonding that you have received less favorable in amount and terms than that of other similar companies who are not socially disadvantaged?

Credit or Financing:

1. Have you or your company ever been denied the required credit or financing needed to acquire necessary equipment, etc. or to finance the ongoing operations of your firm?

2. Were the terms (e.g. interest rate, collateral, etc.) of this financing less favorable than those received by similar companies who are not socially disadvantaged?

Licenses:

1. Have you or your company ever been denied a license required by you to conduct business?

2. Have you or your firm ever had a necessary license revoked?

Leases:

1. Has your firm ever been denied a real or tangible property lease?

2. Were the terms of your leases less favorable than those received by similar companies who are not socially disadvantaged?

Market Restrictions:

1. Have you or your firm ever been denied access to a client or to bidding on a contract opportunity?

2. Has your firm ever been rejected for a business opportunity on terms that were different than those provided to other similar firms that were not socially disadvantaged?

Underemployment/Unemployment:

1. Have you ever been denied employment or advancement opportunities that have had a negative impact on your economic situation?

2. Have you ever been discharged, fired or downsized on terms that were different than those provided to other equivalently qualified individuals?

____________________________________________________________________________________________________

If you answered YES to any of the questions above or have ever experienced any other form of perceived prejudice or bias in the areas above you will need to answer the questions below:

What were the dates or periods of time over which the above prejudice or bias occurred? (You must be as specific as possible (e.g. January, 2010, January through March, 2010, Fall of 2008, etc.)

Who are or were the person(s) and/or entities (i.e., organizations) involved and their respective positions or titles (You must be as specific as possible (e.g. first and last name, title, name of company. If you cannot remember exactly, please provide as much information as possible and state to the best of your recollection)

Identify and describe the specific instances that you claim represent the substantial and chronic prejudice or bias you have identified above? Be very specific, using the “street language” that may have been used.

What specific actions are being taken or were taken by you to overcome the effects of the prejudice or bias experienced by you or your company? (e.g. filed lawsuit, threatened lawsuit, wrote letter requesting reasoning, etc.)

Identify and discuss the specific negative impact (economic, loss of professional development, damage to your personal or company reputation) on you and/or your firm on the entry or advancement in the business world because of this disadvantage experienced by you. (You must be as specific as possible, e.g.  the loss of revenue, profits or salary in actual dollar amounts.)

What type of physical evidence will you or can you provide to substantiate your claims of prejudice or bias? e.g. court or administrative findings, affidavits, documents related to rejected bonding, contemporaneous records memorializing meetings, conversations, negotiations, telephone calls,  a letter or two from a co-worker that observed the above incident)

What additional facts do you consider relevant to claiming and/or evidencing the prejudice or bias that you claim? (For example, were there other incidents involving others who may have been subjected to the same types of prejudice or bias as you, if so, be specific about the name of the company, individuals, titles, dates, things said/done, minority/non-minority, etc

SAMPLES

View our sample economic and social narratives of disadvantage. They are actual narratives that have been approved by the SBA. The names have been changed to protect the identity of the individuals but will give you a good idea of the level of specificity that must be provided with your narrative.

For more information on the SBA 8(a) Program, visit cloveer.com or call 813-333-5800. Over 1,600 successful 8(a) Applications .