Small businesses, new and established, can benefit from doing business with the federal government. Purchasing approximately $600 billion a year, the federal government buys goods and services ranging from space engines to janitorial work. The U.S. Small Business Administration works closely with federal agencies to ensure small businesses obtain their fair share of government contracts and subcontracts. In 2012, $128.5 million was awarded to West Virginia small businesses.
Judy Sheppard, President and CEO of Professional Services of America Inc., was in business for more than 15 years before she entered the government contracting realm. Sheppard’s Parkersburg office sits next to the Bureau of the Public Debt, and she couldn’t comprehend why she wasn’t able to do business with them. Sheppard spoke to the local small business specialist who directed her to the SBA to learn more about the Small Business Set-Aside Program. Through a congress mandated act, federal agencies are required to establish contracting goals, with at least 23 percent of all government contracts targeted to small firms.
Sheppard spent time researching the qualifications for becoming an 8(a) certified business. At first, she was overwhelmed and an application packet sat on the corner of her desk, and she would recall that, “Every day I would stare at the packet knowing I was losing money.”
This did not sit well with Sheppard; she was determined to complete the process. She started chiseling away at the application and upon completion she kissed it, knowing her life and her company were about to change forever.
PSA is now a woman-owned, Native American, HUBZone-certified, SBA 8(a), small disadvantaged business. They engage in a wide variety of services primarily focusing on human resource staffing and project management. This fall, after completing the allowed nine years in the program, the company will graduate. Sheppard looks forward to the challenge and is eager to help other companies learn the process. PSA currently works with 28 federal agencies and employs over 300 staff members.
“It’s never too late to get started doing business with the government,” Sheppard said. “I was in the corporate sector for more than 15 years before I branched out; I saw an opportunity and went for it.”
Sheppard credits the West Virginia District Office of the SBA stating, “When in doubt, reach out. When I first started the process – SBA, 8(a), GSA – it all sounded like a lot of alphabet soup to me. The team at the West Virginia District Office is wonderful and they really break everything down and make it understandable.”
The West Virginia District Office delivers SBA programs and services to small business throughout West Virginia from two locations, Clarksburg and Charleston. In 2012, SBA trained over 1,500 WV small businesses on how to do business with the federal government, including SBA certification programs.
Sheppard received the SBA 2011 Small Business Person of the Year and the 2006 Women in Business Champion award. For more information on doing business with the federal government, visit http://www.sba.gov/category/navigation-structure/contracting.
SBA provides WV Company the "Opportunity" in Popular Saying "Luck is what happens when preparation meets opportunity"
Diane Lewis epitomizes the popular saying, “Luck is what happens when preparation meets opportunity,” and she credits the U.S. Small Business Administration (SBA) for providing her the “opportunity” to succeed. Over the past decade Lewis has utilized the programs and resources offered by the SBA, including participation in the 8(a) Business Development program.
Lewis started Action Facilities Management in the basement of her home in 2001 as a sole proprietor, and incorporated the business in 2003. Initially the business was a two person operation, Lewis in the lead and her son Donald Hill, who was 17 at the time, as the secretary. The company received assistance from the SBA in developing a business plan and Lewis began taking advantage of educational workshops on government contracting. However, Lewis had greater plans of involvement with the SBA in mind; she was familiar with the SBA 8(a) Business Development program and knew it was the right direction for her business.
The 8(a) Business Development program is a nine-year program created to assist eligible socially and economically disadvantaged individuals in developing and growing their businesses. Through the program businesses receive assistance including counseling, training, and match-making opportunities with federal buyers.
A company must be in business for two years before they can enter the program; Lewis used this time wisely and fiercely prepared the business for entry into the program. AFM worked security sub-contracting jobs and used the income to purchase marketing materials and conduct outreach to government agencies. “This initial preparation and marketing to agencies really helped me stand out. I went back to them after entering the 8(a) program and already had my foot in the door,” stated Lewis.
Luck was right around the corner as Lewis was about to earn the opportunity she dreamed of. Lewis successfully completed the application and began the journey into the 8(a) Business Development program. During her nine years in the program Lewis took advantage of every resource that was offered. She attended match-making events and received one-on-one counseling that helped mold her company into what it is today. Lewis won contracts reserved for 8(a) companies with federal agencies including the U.S. Department of Homeland Security, U.S. Department of Energy, U.S. Department of Defense, U.S. Department of Health and Human Services, U.S. Navy, U.S. Department of Labor, U.S. Department of State, U.S. Army Core of Engineers, Library of Congress, West Virginia High Technology Consortium and many others.
“If I could give small businesses one piece of advice, it would be to utilize the resources available through the West Virginia District Office of the SBA,” Lewis states. “They are there to help you, I wouldn’t be where I am today without them.”
Recently graduating the 8(a) Business Development program, AFM is thriving. Lewis now employees approximately 300 employees (almost half from West Virginia), has tripled revenue over the past three fiscal years, and provides services to over 20 clients in 11 states and the District of Columbia. Hill also received a promotion; he is now the chief operating officer and runs the company’s Washington D.C. location. Diane praises her hard working staff stating, “I give credit to my staff and employees that represent Action Facilities Management at the various federal facilities every day. They do their job with pride and in turn it allows us to grow the company.”
“Diane has worked very hard to get to where she is,” stated Judy McCauley, West Virginia district director of the SBA. “I am so happy that the 8(a) program gave her the opportunity to be so successful.”
Lewis is also the winner of the 2013 SBA West Virginia Small Business Person of the Year award. She received recognition in May during the Teaming to Win Conference.
McCauley concludes, saying “We are the lucky ones to have Diane represent the great state of West Virginia as the 2013 Small Business Person of the Year.”
Shocking but true statistics: 20 percent of all small businesses survive the first year, 30 percent survive the second year, and half survive the first five years1. The U.S. Small Business Administration (SBA) provides programs and services to assist small businesses that are just getting started and help keep guide them in the right direction.
MOVID Studios, in Parkersburg, West Virginia is one company that successfully completed their first year of business and credits the SBA for helping them getting over the first-year hump.
Jon Defibaugh, a former commercial producer for the local television station with 11 years of experience, decided to open his own multimedia company in June 2011. Defibaugh struggled the first six months, as many new businesses do, but was able to sign several contracts to keep him busy through 2012. However, there was a problem; he had one camera, one computer and a car that was falling apart. Defibaugh was one misfortune away from being out of business. That’s when he met with his local bank to secure the funding needed to purchase backup resources.
To his surprise, he heard from multiple banks that the business was “just too young” and regardless of how nice of a guy he was and how good of a plan he had, they wouldn’t even consider giving him a loan until his company was 12 to 24 months old and was profitable beyond being able to cover the bills. Defibaugh was faced with not being able to obtain a traditional loan and also unable to secure a line of credit due to not having enough equity or income to justify the amount he needed. His luck began to change when one loan specialist recommended he speak to Tim James from First Microloan of West Virginia, a SBA designated lender. With counseling from the West Virginia University Parkersburg Small Business Development Center (SBDC), partially funded through SBA, Defibuagh was able to perfect his business plan and secure a loan through the microloan program.
“I am never a proponent of debt, but managed debt is better than zero cash flow because you can’t survive. If you borrow $20,000 over four years, and pay $500 a month – that is manageable for me,” states Defibaugh. “I don’t think I would have been able to find another way to keep my business open, I would’ve had to scale down that first year and either end up failing or growth would have been so slow that I still wouldn’t have been eligible for a traditional loan or line of credit because I wouldn’t be able to show the numbers.”
Because of the assistance Defibaugh received from SBA, he was able to purchase additional equipment, expand office space, and take on regional clientele. MOVID Studios is reclaiming the technology and video industry in Parkersburg and allowing local companies to get high quality services that had recently been outsourced to other states.
For more information on programs and services offered by the SBA, visit www.sba.gov.