The unprotected space outside of the small business programs is what I call No Man’s Land, where unprepared companies get crushed by giants.  Every small business providing goods and services to the U.S. federal government has to think about the day when they will outgrow or “graduate” from their small business status, even if that day seems far off in the future.

Small businesses drive the U.S. economy, and the government fosters the health of this vital sector through the activities of the Small Business Administration (SBA) and small business programs at federal departments and agencies. Those programs include goals for small business participation in the procurement activates of the agencies, segmented into various socio-economic categories.

Life is pretty good while you fall into one or more of these categories and stay within the designated size limits for the goods and services your company provides.  You might be eligible for sole source contract awards.  Large businesses will be eager to add you to their teams because they have small business subcontracting goals to meet.  Of course, you have to provide quality goods and services, on time, and at competitive prices — not always easy.  But at least it is better than being in No Man’s Land, going toe to toe against the large corporations that dominant the federal contracting landscape.

As a small business owner you have four main options:

  • Stay beneath the size standards for your primary NIACS,
  • Prepare to compete and thrive in No Man’s Land,
  • Sell the company, or
  • Go out of business.

Don’t let that day sneak up on you.  Here’s how to get ready:

Assess your situation.

What are your personal, financial, and business goals?  Take an honest look at your company, the business environment, your industry, and your competition.  Looking at your strengths and weakness, how do you stack up against the field?  Do trends present opportunities to enhance your competitive advantage, to re-invent your company, or reshape the market?


Select criteria that are most important to you. Evaluate the options according those criteria. Make a sound, logical decision. Try to keep emotions out of it.

Take Action.

If you decide to stay small, it is possible to be a great small company.  I suggest reading Small Giants: Companies That Choose to Be Great Instead of Big by Bo Burlingham.

If you decide to compete and thrive in No Man’s Land, I suggest reading Good to Great and Great by Choice by Jim Collins and Blue Ocean Strategy by W. Chan Kim and Renee Maugorgne. Make sure you get back to basics. Figure out that one main thing you can be best-in-class at doing, and redesign your business around that. Take a good look at your staff. Do you have the right people for this adventure? Develop a culture of discipline and relentless execution, and keep pushing toward your preferred future. A good management consultant can help you develop a strategy and an action plan to get you on the path to success.  Get prepared to thrive in No Man’s Land.

If you’re thinking about selling the company, make sure you are aware of all your transition options; figure out what you want your life to look like after business ownership; and get some help from a Certified Exit Planning Advisor. I suggest you read Walking to Destiny: 11 Actions an Owner Must Take to Rapidly Grow Value & Unlock Wealth by Christopher M. Snider. As you move forward in the process of getting ready to sell, you might decide to keep growing instead. Exit planning is good business planning, and will result in higher sales and better cash flow.

Closing up shop is also an exit strategy.  If you decide to go out of business, make sure you do so in an orderly fashion with the least amount of negative impact on all stakeholders.