FORT BELVOIR, Virginia, July 21, 2020 —
From gowns, gloves and pharmaceuticals for the USS Comfort and Mercy to decontamination systems for medical workers’ N95 masks, America’s small businesses are helping meet the nation’s demand for COVID-19 supplies.
“We can rely on our small companies to stand toe-to-toe with us, to help the American public overcome something most of us haven’t seen in our lifetimes,” said Dwight Deneal, the Defense Logistics Agency’s director of small business programs.
Of the 12,000 companies DLA works with, about 9,000 are small businesses, according to agency data. Deneal said almost 40% of DLA’s spending has gone to small businesses so far this fiscal year although its Defense Department-assigned goal is 32.36%. He attributed the increase to greater demand for personal protective equipment from military customers, Health and Human Services, and the Federal Emergency Management Agency.
The Department of Homeland Security identified the defense industrial base as critical when local jurisdictions closed businesses in March to slow the virus’ spread. Ellen Lord, under secretary of defense for acquisition and sustainment, told defense industry leaders that month they had a “special responsibility” to maintain normal work schedules.
Despite economic disruptions, small business specialists at DLA Troop Support have been flooded with inquiries from business owners wanting to provide personal protective equipment to the government, said Mike McCall, who oversees small business programs at the Philadelphia-based activity.
“Small businesses have really stepped up during the pandemic and have been integral to providing PPE to FEMA and HHS,” he said. “In a lot of cases, they’re more flexible than large suppliers because they can change their manufacturing processes, which are on a much smaller scale, quickly.”
Though some new contracts for personal protective equipment have been awarded to businesses with previous government contracts, the urgent call for protective equipment has also drawn new vendors. A solicitation for small or large businesses to provide isolation gowns and non-surgical face masks resulted in contracts with three small businesses new to DLA, McCall said. A separate contract for cloth face masks was awarded to a woman-owned small business that also had never worked with the agency. Small businesses have even sourced items for kits for medical staffs at 15,500 nursing homes across the nation. And a small business supplied food for military members augmenting mobile hospitals in New York.
The rising interest from vendors wanting to provide protective equipment prompted DLA Troop Support to create a vetting group that determines whether small business’ products meet standards set by the Food and Drug Administration and Centers for Disease Prevention and Control. The group is also answering questions on how to do business with the agency.
“We’ve gotten more and more small businesses owned by retired military or civil servants trying to provide things like N95 masks that they would get from 3M, so in some cases we’re helping them learn how to do business with the government for the first time,” McCall said. His staff of six small business specialists were still getting about five inquiries a day from prospective contractors in early July.
With new partnerships has come the need to support small vendors who’ve felt the strain of local closures and social distancing.
Increased sanitation measures and supply shortages are as challenging for business owners as they are for families, Deneal said, adding that the cost of new protocols has slashed companies’ revenue.
Recognizing that small businesses are essential to keeping warfighters supplied, small business specialists and acquisition professionals throughout the agency have monitored suppliers’ status. Over 670 large and small companies tracked by DLA closed in April, said Glenn Starks, chief of DLA Acquisition Programs Division.
Links to Small Business Administration resources were added to the small business page on DLA’s website to help small businesses recover from pandemic struggles. The agency also made it easier for small business contractors to buy non-medical personal protective equipment by opening a new COVID-19 Contingency Store on FedMall. Outreach events and the annual DLA Industry Day have been replaced by video and web conferencing interactions. And a monthly Doing Business with DLA webinar provides information on acquisition processes.
“The only way we’re going to be able to execute requirements and stay mission-ready in support of warfighters and the whole of government is by having the pulse of our small business industrial base. That means having a way to reach out and touch companies from coast to coast even though we can’t be in the same physical environment,” Deneal said.
Fragile industrial base
Tracking the health of small businesses is especially important in fragile areas like clothing and textiles, McCall added. The number of vendors providing items like uniform dress clothing has reduced to half in the past 10 years. DLA Troop Support held a virtual Dress Clothing Industry Day in April to assess industry needs and connect with new vendors.
“During a pandemic like this, there’s a real possibility that these companies could go out of business. That’s a significant concern because everything we buy in the clothing area has to be manufactured in the U.S., but in many cases, the contracts we award keep these companies in business,” he said.
The Procurement Technical Assistance Program that DLA manages in cooperation with state and local governments also helps ensure small businesses have access to DOD contracts. With over 300 centers in Washington, D.C., Puerto Rico, Guam and 48 states, PTAP services range from identification of contracting opportunities to instructions on bidding processes and registering in federal procurement systems. PTAP staffs are providing consultations via video and phone conferences during the pandemic.
The focus on American small businesses began after the Great Depression, when many companies that provided parts the military needed for World War I folded. Realizing small business owners who produced wartime commodities lacked the money to keep afloat in peacetime, Congress initiated the Small Business Mobilization Act in 1942. It allowed the government to pay small businesses a price differential to help them maintain and accelerate production.
The Armed Service Procurement Act of 1947 later extended that policy to peacetime and required a “fair proportion” of federal contracting dollars be placed with small business. Today, DLA’s small business specialists work with buyers and contracting officers to build acquisition strategies that attract small businesses to contracts worth over $10,000.
Leading small businesses to potential DLA contracts is personally rewarding, McCall said, describing his work with a woman-owned small business that supplies flight vests.
“You not only help them grow their business, but you help the whole area where they’re located because sometimes these contracts establish jobs that weren’t there before,” he said.
While small businesses’ overall role in pandemic support remains to be seen, Deneal added that he’s been moved by the resilience of the American small business community.
“It’s interesting to see how strong and flexible our small businesses have been and their eagerness to support the federal government in a time like this,” he said. “DLA truly values its small vendors.”