This report includes an important set of comments from the U.S. Small Business Administration highlighting the devastating impacts Category Management has had on small business opportunities. GAO-21-40 November 2020

Excerpts – 

“Of the tens of thousands of contracts eliminated by category management, 53 percent of them were small business contracts. That is much greater than the 5-percent figure report reported in 2019 and adds to the long-standing concerns expressed by the small business contracting community.

Moreover, SBA is aware that the number of small business new entrants has dropped nearly 60% from 23,000 in FY12 to just 9,400 in FY19. Firms have withdrawn from SBA’s 8(a) program citing decreasing opportunities and increased consolidation of contracts.

There are simply fewer opportunities for new entrants and young companies, exactly the ones likely to participate in SBA’s 8(a), HUBZone, WOSB, and SDVOSB programs.

This report emphasizes that the category-management initiative must refocus its efforts to reduce barriers to entry, increase vendor participation, clarify ill-defined contract requirements, tackle government-side data challenges, and, most importantly, strengthen small business resiliency. Current efforts have not been sufficient. The increase in small business dollars obscures that there is less small business opportunity.”