NCRC manages the most comprehensive and integrated minority- and women-owned small business support programs and services of any nonprofit in America, consisting of three U.S. Department of Commerce-sponsored Minority Business Centers (Washington, DC, New York, NY, and Houston, TX), an SBA sponsored Women's Business Center, a micro-business loan fund, and the SBA Teaming Center. Over the past three years, NCRC's Centers have assisted their small business clients in securing more than $1.8 billion in financing and more than $350 million in procurement contracts. The services provided address the broad range of needs of firms, particularly of women- and minority-owned businesses, such as help with writing a business plan, improving operational efficiencies, and credit repair counseling to accessing credit and securing contracting opportunities. NCRC's performance is unparalleled within the nonprofit arena, and its success is directly attributable to the integrated functioning of its multiple federally-supported small business support centers.
Unlike the other pilot SBA Teaming Centers, which focus on business training and counseling services, NCRC's Teaming Center works exclusively on identifying procurement opportunities, forming teams, and helping to write contract proposals. NCRC proposes to further innovate their teaming approach by transforming the center's current subsidized model to a self-financing structure. This will be accomplished by hiring 10 business development specialists (BDS). Each BDS would be assigned to specific agency/agencies to understand the requirements of the agency, upcoming contract opportunities, and current contractors working on various contracts. Each will work with clients to secure a total of $30-100M yearly in contracts over a 5-year period.
NCRC expects to increase contracting from $100M annually to more than $1B yearly, within five years. If successful, this proposal will generate sufficient revenue to become self-sufficient through fee income, greatly enhance access to large contracts to women-and minority-owned firms, and offset the federal match for other federal small business programs.
Program Ramp-up and Stabilization
NCRC anticipates a 4 year ramp-up phase. Year one, NCRC would hire 10 business development specialists (BDS) and assist small businesses in securing ~$300M in government contracts. In the preceding two years, each BDS would be responsible for assisting small businesses secure $50M in contracts in year two and $75M in contracts in year three (totals being $500M and $750M respectively). Year four, each BDS would be responsible for assisting small businesses to secure $100M in contracts ($1B total). This number is anticipated to increase at 3% per year. NCRC anticipates being paid, on average, a fee of the small business' profits for the awarded contract that ranges from 1% in year one to 4% in year seven.
Also in the first year, NCRC anticipates aggressively fundraising and securing the remaining $10M for the NCRC Small Business Endowment from 2012 through 2013. For the preceding five years of operation, NCRC anticipates utilizing, on average, ~$1.1M per year to sustain the program. Years 6-10 NCRC anticipates utilizing, on average, ~125k per year to sustain the program and in year seven drawing no funds and generating a surplus from its business activities.
Secure remaining $10M for the Small Business Endowment, and assist small businesses secure $300M in contracts and $30M in financing, creating over 40 jobs.
Assist small businesses secure $500M in contracts and $50M in financing, creating over 70 jobs.
Assist small businesses secure $750M in contracts and $75M in financing, creating over 105 jobs.
Assist small businesses secure $1B in contracts and $100M in financing, creating over 140 jobs.
Assist small businesses secure over $1B in contracts and $105M in financing, creating over 145 jobs.
Small Business is the backbone of the American economy, creating more than 50 percent of nonfarm private GDP and employing about 50 percent of all private sector workers, according to the Small Business Administration (SBA). Unfortunately, small businesses have struggled to survive during the great recession. As reported in the Wall Street Journal, about 4.3 million businesses with 19 or fewer employees closed from the fourth quarter of 2007 through the fourth quarter of 2008 alone.
As Americans look to tighten their budgets, many small businesses are left to find new revenue streams to ensure their survival. One of these, which both the public and private sectors have sought out, is a government procurement contract. When large corporations win federal contracts, their existing workforces take on the project, but, when small firms get the work, they hire people, stated Rep. Nydia M. Velazquez (D-NY), the Chairwoman of the House Committee on Small Business. 'Making the contracting system work for entrepreneurs is not just a small business priority, it is a jobs issue.' Women- and minority-owned firms, which are the fastest growing, face the greatest challenges securing federal contracts.
In 2011, the SBA launched the Small Business Teaming Initiative, which awarded grants to organizations to train, counsel, and mentor small businesses, and help them partner and compete for larger federal contracts. NCRC was one of ten groups selected to participate in this initiative. NCRC has determined that many companies have the capacity to perform the work required by a government contract once it is secured; however, many firms face challenges including:
Inexperience with, and/or inadequate capacity to submit a competitive bid proposal;
Inability to secure the required financing to grow their firm due to overly stringent credit standards in the current financial crisis;
Lack of professional contacts within federal agencies who can alert them to contracting opportunities and shepherd them through the contracting process.