Government as a Buyer
The U.S. Government is the world's largest buyer. All over America it is constantly ordering big quantities of machinery, equipment, supplies, and services. As a buyer, Uncle Sam is not very cost-conscience and tends to spend top dollar. Instead of taking the lowest bid or best supplier, government agencies may be required by law to give a fixed percentage of their orders to small businesses.Certain government orders are "set aside" for sales crm and small business. Bigger companies aren't allowed to bid on them, so small companies are competing only among themselves for these contracts. Over the years, small business has won about one-fifth of the military's total dollar awards. It got $7 billion worth in one recent year. In addition, small firms make hefty sales to the Nuclear Regulatory Commission, the Department of Agriculture, and other big agencies. Lumber is a good example. The SBA persuaded the Department of Agriculture's Forest Service to set aside parts of the contracts for cutting federal timberland, and the little logging companies survive only through that program.