National Women’s Business Council Reports Gains for Women-Owned Small Businesses

November 20, 2013

In 2000, the Equity for Contracting for Women Act reiterated an existing goal of giving five percent of federal contracts and award dollars to women-owned small businesses; this act served as the backbone for the WOSB FCP. The WOSB FCP was implemented in the beginning of fiscal year 2011, although the analysis covers data from 2000 through the first half of 2013.  The program aims to reduce the inequity in contract and award distribution of prime federal contracts to WOSBs through the use of set-asides, and has designated 83 NAICS codes (i.e., 83 industries) in which WOSBs are underrepresented. This infographic examines the impact of the program, as well as general trends in WOSBs and federal procurement.

Please see the footnote below for important information on methodology, as the practices used in this analysis may differ substantially from those of other government entities.

Important highlights from the infographic include:

  • In 2012, WOSBs were awarded 182,791 contracts worth $11.5 billion. That amounts to 11.5% of all contracts and 5.3% of all award dollars.
  • Since 2000, WOSBs have received an increasing share of contracts and awards, not only within the 83 designated industries but in other industries as well. But although WOSBs are generally meeting the contract threshold within the 83 underrepresented industries, they remain underrepresented in terms of awards share.
  • Since 2000, the number of federal agencies meeting the 5% goal has generally increased, although there are more agencies meeting the contracting goal than the award goal. The top five agencies in terms of number of contracts awarded are the Department of Defense, Department of Justice, Department of Veterans Affairs, Department of the Interior, and the General Services Administration. These agencies have all met the 5% goal for contracts awarded since fiscal year 2000—and represent 88% of total WOSB contracts.

Although it is clear that WOSBs have made substantial progress in the federal marketplace, there are still areas for improvement. Some findings from the report may be useful for WOSBs in the procurement arena, most notably that:

  • There is a high rate of turnover among WOSB vendors. Almost half of all WOSB vendors received contracts only in a single fiscal year. Consistent with general procurement trends for WOSBs, vendors with more longevity and stability (i.e., receiving contracts in multiple fiscal years) were able to secure a larger portion of contracts through the use of the WOSB and EDWOSB (economically disadvantaged WOSB) set-asides. Thus, it is important for women business owners to stay involved in procurement.
  • The most frequent type of contract action for WOSBs from FY2007 to FY2012 was purchase orders, followed closely by delivery orders. One reason for potential disparities in award levels between WOSBs and non-WOSBs is that the average award for a purchase order contract was only worth 12 percent of the average award for a delivery order contract. Interestingly, the majority of dollars awarded to WOSBs come from delivery orders. This suggests that the type of contract may be just as important as the number of contracts.

Finally, there was another interesting trend:

  • Award dollars are concentrated among a small number of WOSB vendors. For example, in 2012, 20% of awards (amounting to $2.3 billion) went to 44 WOSB vendors. The other 80% of awards ($9.2 billion) went to 17,648 vendors.

Overall, it appears that the outlook for WOSBs in government contracting is good. Shares of contracts and awards going to WOSBs have been steadily increasing over the last decade, and our infographic includes tips for owners of WOSBs who are interested or already involved in federal procurement. You can view the full text report here.

Note on methodology:

This analysis covers the period from the federal government’s fiscal year 2000 through the first half of fiscal year 2013 (March 2013).  Data was procured directly from www.usaspending.gov; contact Emily Bruno at emily.bruno@nwbc.gov for the complete data book. This research evaluated WOSB procurement in terms of contracts, as opposed to actions. This is an important distinction, as numerous government organizations rely on actions when reporting small business data.  However, multiple actions can, and do, occur on the same contract for a particular vendor.  We focused on the total contract value for a specific contract by employing a contract “roll-up” process that consolidated multiple actions into a single contract database record.