The Small Business Subcontracting Plan clause does not apply to small business concerns 1. For other-than-small primes, it turns subcontracting intentions into commitments the contracting officer can measure.
When a plan is required
In negotiated acquisitions, each solicitation of offers to perform a contract that is expected to exceed $900,000 ($2 million for construction) and that has subcontracting possibilities shall require the apparently successful offeror to submit an acceptable subcontracting plan 2. If that offeror fails to negotiate an acceptable plan within the time limit the contracting officer sets, it will be ineligible for award 3.
Multiple-award contracts add a choice. For a multiple-award contract with more than one NAICS code, the offeror may submit a plan either for the distinct portions or categories of its proposal for which it is other than small, or for its entire proposal, at its discretion 4.
What the plan commits you to
The plan sets separate goals, expressed in total dollars subcontracted and as a percentage of total planned subcontracting dollars, for the use of small business concerns, among others 5. It names the individual employed by the offeror who will administer the subcontracting program, with a description of that person's duties 6.
It also assures that the offeror will make a good faith effort to buy from the small business concerns it used in preparing the bid or proposal 7. If the contractor does not, it owes the contracting officer a written explanation within 30 days of contract completion 8.
A commercial plan is the preferred type of subcontracting plan for contractors furnishing commercial products and commercial services 9.
For a subcontractor's status, a firm may rely on the information contained in SAM as an accurate representation of a concern's size and ownership characteristics 10. Bids2Bank's vendor check records whether a partner's SAM.gov entry lists it as small for the NAICS code on the bid 11 and which certifications the entry lists 12.
Reporting
The Individual Subcontract Report is required for each contract containing an individual subcontracting plan 13. It is submitted semi-annually during contract performance for the periods ending March 31 and September 30 14, and reports are required when due, regardless of whether there has been any subcontracting activity since the inception of the contract or the previous reporting period 15. The clause requires these reports and the Summary Subcontract Reports to be submitted through the web-based eSRS 16.
The standard is good faith. The failure of the contractor or subcontractor to comply in good faith with an approved plan shall be a material breach of the contract and may be considered in any past performance evaluation 17. Your record follows you: prior compliance with other subcontracting plans will be considered in determining the offeror's responsibility for award 18.
Worked example. Halfway through year one, Contractor U's tracking shows it at 4% of planned subcontract dollars with HUBZone small businesses against a 6% goal. Its administrator lists the upcoming purchases that HUBZone firms could supply, invites three to quote on the next one, and keeps the invitations and responses with the plan file.
Check a partner's SAM.gov status on a bid →
Indented paragraphs are invented worked examples. Tool links open Bids2Bank and need a free account.