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“DRIVING OPPORTUNITIES TO SMALL, DC-AREA FIRMS

DEC // 15 //11

>>>>>>>>>>>>>>

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THE OVERALL SMALL BUSINESS ENVIRONMENT >>>>>>>>>>>>>>

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OMB AT MID SESSION: DISCRETIONARY CUTS COMING; INTEREST, INFLATION LOOM

3

$816 $835 $860 $805 $771 $761 $768

$490 $477 $440 $394 $384 $387 $388

$-

$200

$400

$600

$800

$1,000

$1,200

$1,400

FY10 FY11* FY12* FY13* FY14* FY15* FY16*

Bill

ion

s o

f d

olla

rs

Actual & Projected Discretionary Outlays FY 2010 - FY 2016

Security Non-Security

2.8%

1.8% 1.9% 2.0% 2.0% 2.1%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

2011* 2012* 2013* 2014* 2015* 2016*

Consumer Price Index, 2011-2016

0.1%

0.5%

1.8%

3.2%

3.8%4.0%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

2011* 2012* 2013* 2014* 2015* 2016*

91-Day T-Note Interest 2011-2016

$196 $216 $234

$295

$378

$461

$525

$-

$100

$200

$300

$400

$500

$600

FY10 FY11* FY12* FY13* FY14* FY15* FY16*

Bill

ion

s o

f d

olla

rs

Net Debt Interest, FY 2010 - FY 2016

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SBA: LEANER . . . MORE WITH LESS?

4

$1,786,000

$993,000 $984,000 $883,000 $876,000

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

$1,800,000

$2,000,000

FY 2010 FY 2011* FY 2012* FY 2013* FY 2014*

SBA Discretionary Outlays and ProjectionsFY 2010 - FY 2014

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THE LAST SIX YEARS: IS THE SB SPENDING PEAK BEHIND US?

5

$250.0 $275.6$310.2

$342.0 $357.5 $331.8

$70.5$75.9

$80.5

$88.0$93.5

$96.3

$0.0

$50.0

$100.0

$150.0

$200.0

$250.0

$300.0

$350.0

$400.0

$450.0

$500.0

FY05 FY06 FY07 FY08 FY09 FY10

Small and Large/Other Vendor Contract Spending, FY05-FY10

Other Small

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THE LAST SIX YEARS: IS THE SB SPENDING PEAK BEHIND US?

6

78.0% 78.4% 79.4% 79.5% 79.3% 77.5%

22.0% 21.6% 20.6% 20.5% 20.7% 22.5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

FY05 FY06 FY07 FY08 FY09 FY10

Small and Large/Other Vendor Sharesof Contract Spending FY05 - FY10

Other Small

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THE COMING FIVE YEARS: CAN SMALL BUSINESS BUCK THE TREND?

7

* Based on OMB MSR Proposed Budget for FY 2012, Table S-4, August 2011 and on

definition of "Security" created in the Budget Control Act of 2011 now used by OMB.

$26.30 $25.60 $23.62 $21.15 $20.61 $20.77

$70.00 $71.63 $73.77$69.06 $66.14 $65.28

$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

FY 2010 FY 2011* FY 2012* FY 2013* FY 2014* FY 2015*

Actual FY10 and Estimated FY11-FY15Security/NonSec SB Contract Spending

NONSEC SECUR

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THE REGIONAL PICTURE >>>>>>>>>>>>>

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DC-MD-VA PLACE OF PERFORMANCE : CONTRACTING POWERHOUSE

9

Category 2006 2007 2008 2009 2010 2011

All Contract Dollars $434,126,799,126 $477,618,361,903 $525,655,760,848 $553,713,242,948 $534,347,977,527 $466,856,032,732

DC-MD-VA Contract Dollars $82,292,256,965 $87,113,592,895 $99,789,721,138 $104,731,923,772 $106,984,678,467 $90,148,881,148

Regional Share 19.0% 18.2% 19.0% 18.9% 20.0% 19.3%

All Federal Vendors 203,011 209,233 213,893 202,755 203,616 187,442

DC-MD-VA Fed Vendors 39,408 42,093 43,386 40,820 41,540 38,167

Regional Share 19.4% 20.1% 20.3% 20.1% 20.4% 20.4%

All Federal Contracts 1,321,540 1,510,783 1,680,563 941,408 948,193 869,637

DC-MD-VA Fed Contracts 130,688 145,316 153,656 125,468 129,075 117,081

Regional Share 9.9% 9.6% 9.1% 13.3% 13.6% 13.5%

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DC-MD-VA PLACE OF PERFORMANCE : CONTRACTING POWERHOUSE (2)

10

19.0%18.2%

19.0% 18.9%20.0%

19.3%

19.4%20.1% 20.3% 20.1%

20.4%20.4%

9.9% 9.6% 9.1%

13.3% 13.6% 13.5%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Regional Dollar Share Regional Vendor Share Regional Contract Share

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DC-MD-VA SMALL FEDERAL VENDORS: QUALITY AND QUANTITY (1)

11

Category FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

All Federal SB Contract Dollars $83,753,030,226 $89,352,845,387 $97,482,523,506 $103,820,565,596 $107,412,675,468 $85,489,434,546

DC-MD-VA SB Contract Dollars $21,762,514,641 $24,098,224,335 $26,282,106,672 $28,128,426,452 $30,312,633,049 $24,365,958,540

Regional Share 26.0% 27.0% 27.0% 27.1% 28.2% 28.5%

All Small Federal Vendors 142,437 146,513 148,797 139,751 138,782 126,239

DC-MD-VA Small Fed Vendors 27,242 28,900 29,600 27,503 27,861 25,256

Regional Share 19.1% 19.7% 19.9% 19.7% 20.1% 20.0%

All SB Federal Contracts 914,013 898,928 976,931 579,885 570,357 506,157

DC-MD-VA SB Fed Contracts 83,741 89,990 93,024 76,232 77,763 69,692

Regional Share 9.2% 10.0% 9.5% 13.1% 13.6% 13.8%

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DC-MD-VA SMALL FEDERAL VENDORS: QUALITY AND QUANTITY (2)

12

26.0%27.0% 27.0% 27.1%

28.2% 28.5%

19.1%19.7% 19.9% 19.7% 20.1% 20.0%

9.2%10.0% 9.5%

13.1% 13.6% 13.8%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Regional SB Dollar Share Regional SB Vendor Share Regional SB Contract Share

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SB-FRIENDLY METRO AREAS: MOSTLY COASTAL

13

Metropolitan Area FY 2005 FY 2010 FY05-FY10 SB Total $ ∆ FY05 - FY10 FY005-FY10 SB Share

Washington-Baltimore, DC-MD-VA-WV CMSA $16,484,925,995 $22,962,513,029 $123,130,514,479 39.3% 26.9%

Los Angeles-Riverside-Orange County, CA CMSA $2,659,951,902 $3,164,356,442 $17,305,086,016 19.0% 3.8%

Norfolk-Virginia Beach-Newport News, VA-NC MSA $1,990,883,861 $3,629,982,432 $16,568,328,242 82.3% 3.6%

New York-Northern New Jersey-Long Island, NY-NJ $2,726,303,795 $2,603,806,731 $16,741,936,652 -4.5% 3.7%

Boston-Worcester-Lawrence, MA-NH-ME-CT CMSA $1,469,058,634 $1,668,734,014 $10,619,869,441 13.6% 2.3%

San Diego, CA MSA $1,427,081,301 $1,696,368,491 $10,389,108,014 18.9% 2.3%

Philadelphia-Wilmington-Atlantic City, PA-NJ-D $1,426,746,823 $1,643,620,395 $9,912,122,725 15.2% 2.2%

Huntsville, AL MSA $1,110,613,942 $1,703,117,153 $9,255,735,443 53.3% 2.0%

San Francisco-Oakland-San Jose, CA CMSA $1,337,057,979 $1,193,440,153 $8,304,723,901 -10.7% 1.8%

Atlanta, GA MSA $1,423,690,326 $1,035,618,342 $7,432,806,622 -27.3% 1.6%

All Other $33,137,501,053 $34,954,787,571 $228,193,417,150 5.5% 49.8%

Grand Total $65,193,815,610 $76,256,344,753 $457,853,648,685 17.0% 100.0%

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THE AGENCY PICTURE >>>>>>>>>>>>>

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DOD62.7%

DVA6.1%

DHS3.9%

HHS3.9%

GSA3.5%

USDA3.3%

DOI2.7%

NASA2.2%

DOE2.0%

DOJ1.7%

All Other8.1%

FY 2010 Agency Share of Overall SB Spending

AGENCY SB SPENDING 1: MOST STILL STRIVING TO ACHIEVE GOALS

15

Agency FY 2010 SB Total FY 2010 Agcy Total SB % Agcy SB Goal Goal Diff

DOD $60,381,459,185 $289,606,812,855 20.8% 22.2% -1.4%

DVA $5,846,657,111 $15,755,419,847 37.1% 28.7% 8.4%

DHS $3,744,984,563 $11,393,873,181 32.9% 31.9% 1.0%

HHS $3,742,668,860 $17,079,927,359 21.9% 19.0% 2.9%

GSA $3,364,421,155 $12,376,685,706 27.2% 35.7% -8.6%

USDA $3,225,295,620 $5,830,583,012 55.3% 49.9% 5.4%

DOI $2,583,437,559 $5,923,848,699 43.6% 55.5% -11.9%

NASA $2,079,242,133 $15,014,414,494 13.8% 15.4% -1.5%

DOE $1,885,282,119 $25,470,394,508 7.4% 5.9% 1.5%

DOJ $1,662,721,091 $5,822,276,014 28.6% 36.8% -8.3%

STATE $1,457,681,293 $3,516,726,748 41.4% 37.0% 4.4%

DOC $1,406,821,538 $3,781,838,793 37.2% 50.8% -13.6%

DOL $816,528,139 $2,470,467,659 33.1% 33.4% -0.4%

TREAS $684,951,844 $2,324,226,881 29.5% 29.4% 0.1%

EPA $679,573,028 $1,633,070,291 41.6% 39.8% 1.8%

DOT $676,743,907 $2,036,948,731 33.2% 43.3% -10.1%

HUD $419,817,159 $1,104,800,503 38.0% 66.3% -28.3%

SSA $359,807,149 $1,001,989,190 35.9% 36.7% -0.8%

DED $292,880,141 $1,629,285,462 18.0% 12.8% 5.2%

AID $109,427,262 $1,366,536,180 8.0% 19.6% -11.6%

FY 2010 SB Utilization At Billion Dollar+ Agencies

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SOCIOECONOMIC GOALS: AGENCIES STRIVE FOR GREATER UTILIZATION

16

$0

$5,000,000,000

$10,000,000,000

$15,000,000,000

$20,000,000,000

$25,000,000,000

$30,000,000,000

$35,000,000,000

$40,000,000,000

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Socioeconomic Group Procurement Spending FY 2006 - FY 2010

SDB 8(a) WOB HUBZone SDVOSB

Socioeconomic Goal Achievement

FY 2006 - FY 2010

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

SDB 4.26% 4.42% 5.15% 5.87% 7.91%

8(a) 3.74% 4.19% 4.76% 5.43% 5.80%

WOB 3.63% 3.71% 3.85% 4.07% 4.62%

HUBZone 2.10% 2.25% 2.42% 2.78% 2.88%

SDVOSB 0.91% 1.08% 1.58% 2.06% 2.64%

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OPPORTUNITIES: HIDDEN IN PLAIN SIGHT?

17

FPDS-NG Contracts Data, FY 2010: $533 billion on 946,689 active contracts;

$137 billion on 734,014 new contracts FedBizOpps, FY 2010: 98,087 pre-bid notices* * Includes: Pre-solicitation; Intent To Bundle

Requirements; Combined Synopsis/Solicitation; Fair Opportunity/Limited Sources Justification; Sources Sought; Justification & Approval

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MULTIPLE AWARD CONTRACTS: INCREASING PRESENCE

18

1,1271,525 1,849

2,2562,586

1,010

1,744

1,978

2,517

3,084

0

1,000

2,000

3,000

4,000

5,000

6,000

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Large/Other Small

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MULTIPLE AWARD CONTRACTS: SB IMPACTS

19

$38.4$44.8

$54.6 $59.1$64.9

$6.7

$8.8

$11.3$13.5

$15.9

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

$70.0

$80.0

$90.0

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Large/Other Small

14.9%16.4% 17.1%

18.6%19.7%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Small Business Share of MAC Dollars FY 2006 - FY 2010

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MULTIPLE AWARD CONTRACTS: UNANTICIPATED CONSEQUENCES?

20

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MULTIPLE AWARD CONTRACTS: NOT GOING AWAY SOON

21

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WHERE TO LOOK FOR OPPORTUNITIES >>>>>>>>>>>>>

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AGENCY SB SPENDING: WHO IS DRIVING SMALL BUSINESS GROWTH?

23

Agency FY05-FY10 SB Tot FY05-FY10 SB % FY05-FY10 Tot $ ∆ FY05-FY10 SB $ ∆ SB-Overall Growth %

DOD $329,239,494,148 65.2% 30.6% 28.0% -2.6%

DVA $24,389,699,738 4.8% 77.9% 180.6% 102.7%

DHS $22,613,114,047 4.5% 24.4% 24.9% 0.5%

GSA $16,858,422,634 3.3% 22.4% 23.4% 1.0%

HHS $16,557,217,411 3.3% 119.3% 72.0% -47.3%

USDA $14,936,657,542 3.0% 54.6% 63.0% 8.4%

DOI $12,817,304,790 2.5% 26.9% 14.9% -12.0%

NASA $12,013,483,285 2.4% 19.8% 17.4% -2.4%

DOJ $9,172,617,072 1.8% 42.8% 24.1% -18.8%

DOE $8,781,688,704 1.7% 10.5% 104.7% 94.2%

All Other $37,352,315,935 7.4% 60.0% 53.7% -6.3%

Total $504,732,015,307

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SOCIOECONOMIC SET-ASIDES: STEADY INCREASES OVER TIME

24

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Largest Small Business Set-aside Programs, Spending FY 2006 - FY 2010

SB 8a SDVOSB HUBZone

SA Type FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY06 - FY10 ∆

SB $17,244 $17,211 $19,436 $23,611 $28,109 63.0%

8a $10,351 $11,794 $14,131 $17,033 $17,690 70.9%

SDVOSB $373 $876 $2,236 $3,029 $4,389 1076.8%

HUBZone $911 $1,235 $1,697 $2,809 $3,132 244.0%

RSB $399 $114 $206 $216 $76 -80.9%

SDB $116 $99 $79 $57 $36 -68.9%

VET $0 $24 $70 $103 $101 320.3%

BuyInd $42 $36 $49 $41 $43 2.0%

HBCU $42 $22 $23 $9 $15 -64.2%

ESB $8 $3 $9 $10 $12 44.0%

VSB $1 $0 $0 $0 $0 -123.8%

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IT SCHEDULE SPENDING: DECLINING SALES

25

$6,753$5,838 $5,212 $5,528 $4,800

$4,598

$4,371$4,194 $4,082

$4,321

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Large & Small Business Spending on the IT Schedule, FY 06 - FY10

Large/Other Small

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SMALL BUSINESS SCHEDULES: A GROWING PRESENCE

26

$0

$100,000,000

$200,000,000

$300,000,000

$400,000,000

$500,000,000

$600,000,000

$700,000,000

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

8A STARS FY 2006 - FY 2010

8A STARS

$0

$50,000,000

$100,000,000

$150,000,000

$200,000,000

$250,000,000

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

VETS FY 2006 - FY 2010

VETS

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FEDERAL MARKET ANALYSIS: WHERE SB SHARE IS GROWING FAST

27

Overall Small Bus FY08-10 Value # of Recompetes

FSG FSG Name FY08-10 $ Size FY08-10 SB $Size SB Mkt % 3-Yr Growth 3-Yr GrowthSB ∆ - Mkt ∆ Of Recompetes Next 24 Mos.

88 LIVE ANIMALS $188,445,892 $100,925,392 53.6% 134.2% 574.0% 439.7% $38,021,379 66

96 ORES, MINERALS AND PRIMAR $10,281,936,082 $5,110,309,503 49.7% 96.1% 484.6% 388.5% $481,384,377 37

22 RAILWAY EQUIPMENT $738,070,095 $39,336,659 5.3% -58.9% 237.5% 296.4% $672,234,588 6

E PURCHASE OF STRUCTURES/FA $266,924,249 $63,018,495 23.6% -14.1% 217.0% 231.1% $24,588,843 44

P SALVAGE SERVICES $1,752,714,631 $877,836,832 50.1% 17.4% 144.1% 126.7% $215,349,232 103

42 FIRE FIGHTING RESCUE SAFE $3,853,297,910 $2,596,329,992 67.4% 15.9% 64.6% 48.7% $198,703,649 265

L Technical Representative $7,406,020,884 $637,497,291 8.6% 0.4% 46.1% 45.7% $3,047,978,751 439

99 JEWELRY & MISC ITEMS $18,977,617,867 $2,517,511,995 13.3% -69.9% -26.6% 43.4% $764,796,898 780

45 PLUMBING, HEATING, WASTE $488,599,139 $287,150,203 58.8% -10.7% 28.1% 38.8% $30,490,071 246

Y CONSTRUCT OF STRUCTURES/F $115,597,080,819 $29,935,152,374 25.9% 17.0% 54.2% 37.2% $28,548,335,539 3,704

Top 10 Accelerating Small Business Markets

Where Small Business Is Gaining Ground In the Federal Government

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FUNDING OFFICES: WHO SPENDS THE MONEY?

28

fo_name fo_city fostate 2006 2007 2008 2009 2010 Grand Total

NAVSEA HQ Washington Navy Yar DC $2,170,142,252 $2,831,410,697 $2,758,152,788 $2,699,543,799 $2,061,075,583 $12,520,325,119

COMMANDER QUANTICO VA $2,032,419,843 $1,226,388,789 $911,795,817 $1,105,878,316 $1,808,025,629 $7,084,508,394

NAVAL AIR SYSTEMS COMMAND ARLINGTON VA -$5,764 $1,223,873 $0 $1,218,110

CRYSTAL CITY VA $0 $0

Patuxent River MD $434,198,521 $959,162,414 $1,394,858,222 $992,291,132 $1,317,069,330 $5,097,579,620

PATUXENT RIVER NAVA MD $393,682 $38,564,646 $1,364,589 $40,322,917

IRS/CONTRACTS & ACQUISITION DIVIS WASHINGTON DC $863,480,415 $982,658,707 $996,610,264 $497,798,633 $1,060,016,777 $4,400,564,796

PR W6DS PEO SOL Fort Belvoir VA $250,684,411 $874,247,747 $1,271,131,402 $745,711,057 $625,260,165 $3,767,034,782

DISA SKYLINE FIVE FALLS CHURCH VA $637,552,901 $583,311,560 $626,026,776 $713,266,162 $752,752,595 $3,312,909,994

NAVY, DEPARTMENT OF THE ANNAPOLIS MD $1,581 $2,517,840 $3,445,716 $4,756,270 $10,721,406

FORT GEORGE G. MEAD MD $979,388 $979,388

NORFOLK VA $482,498 $194,428 $406,554 $217,792 $26,536 $1,327,808

WASHINGTON DC $77,338,239 $1,029,464,320 $635,815,746 $436,618,131 $391,630,655 $2,570,867,092

NAVAL AIR WARFARE CENTER AIR DIV Patuxent River MD $263,917,606 $298,701,398 $259,838,290 $383,206,963 $569,732,429 $1,775,396,687

DIVISION OF PROCUREMENT SERVICES BALTIMORE MD $3,030,464 $11,343,856 $55,426,580 $244,349,752 $1,185,284,038 $1,499,434,690

Bethesda MD $4,420,614 $3,507,893 $3,623,150 $4,491,268 $25,087,860 $41,130,784

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GOVERNMENTWIDE DIRECTIVES: POSITION FOR THE LONG TERM

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QUESTONS >>>>>>>>>>>>>