WASHINGTON, July 13, 2016 /PRNewswire-USNewswire/ -- According to a new report from Bloomberg Government – "The Mid-Tier Paradox: Too Small to Compete, Too Large to Survive" – mid-tier companies occupy a unique position in the federal marketplace. With no special procurement incentives, many are left fighting for a piece of the market against large prime contractors with ample resources.
Midsize federal contractors that grow out of their small business size standards don't qualify for small business set-asides yet are forced to compete against large businesses that have extensive past performance qualifications and a broad array of professional certifications and security clearances.
Over the past five years, average annual prime contract revenue for mid-tier and large companies shrank steadily, so that by fiscal 2015 both sectors experienced their smallest revenues since fiscal 2011. Yet mid-tier companies grew their market share during that period -- from 24.9 percent in fiscal 2011 to 27.5 percent in fiscal 2015.
Key report findings:
Nearly all of the top FY2015 mid-tier contractors bounced between size classifications over the last five years.
Smaller mid-tier companies are locked out of key markets or forced into secondary roles by large MACs with extensive past performance requirements like Alliant.
To further unlock the potential of innovative and battle-tested mid-tier companies some agency and legislative relief may be appropriate
"Mid-tier companies lack the deep pockets of the large prime contractors and yet don't qualify for small business preference programs," said Paul Murphy, senior data analyst, "This report is an opportunity to explore the challenges and opportunities for these mid-size companies."
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