NAICS Code Appeal for HHS IT & Comm Task Alters Competitive Landscape

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Successful NAICS Code Appeal Dramatically Alters Size Standard – September 7, 2016, By Steven Koprince, LinkedIn Pulse

NAICS code appeals, while little known, can be an extraordinarily powerful tool when it comes to affecting the competitive landscape of government acquisitions.

Case in point: in a recent NAICS code appeal decision issued by the SBA Office of Hearings and Appeals, the appellant prevailed–and obtained an order requiring the contracting officer to change the solicitation’s size standard from 500 employees to $15 million.

OHA’s decision in NAICS Appeal of Hendall Inc., SBA No. NAICS-5762 (2016) involved an HHS solicitation for support for its public engineering platform. HHS issued the solicitation as a small business set-aside under NAICS code 511199 (All Other Publishers), with a corresponding 500 employee size standard.

Here’s where many small businesses would throw in the towel: “500 employees? I can’t compete with that. I’m moving on to the next solicitation.”

G2X TAKE: We have all seen our fair share of solicitations that utilize some unusual NAICS code that benefits the incumbent, but as this article highlights, one HHS contractor took advantage of a seldom used appeals process to successfully challenge the designated NAICS identified on an outstanding HHS solicitation. The result is that it turned the competitive landscape for this competition on its head, as this SB aside went from an under 500 NAICS to an under $15M.

All firms are looking for a competitive advantage and, while this may remain seldom used by any one company, understanding when and where to employ this can come in handy.

Of note- with HHS having dozens of "similar communications/IT contracts in play, the under 500 person NAICS have been used often. With the communications efforts leaning towards more digital approaches, you may see small firms paying closer attention the NAICS selected moving forward

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