{"id":788,"date":"2011-06-13T13:52:50","date_gmt":"2011-06-13T13:52:50","guid":{"rendered":"http:\/\/www.bidlink.net\/news\/?p=788"},"modified":"2011-08-04T19:12:27","modified_gmt":"2011-08-04T19:12:27","slug":"fabrication-defense-industry","status":"publish","type":"post","link":"https:\/\/www.bidlink.net\/news\/2011\/06\/fabrication-defense-industry\/","title":{"rendered":"Fabrication for the Defense Industry"},"content":{"rendered":"
\"Shotgun<\/a>
A shell casing flies out with a trail of smoke Photo: Staff Sgt. Suzanne M. Day, USAF<\/figcaption><\/figure>\n

By Thomas Gerbe, Defense Information Analyst, BidLink.net<\/p>\n

We compared the top 10 companies from the Fab 40 against our database of defense contracts and made a surprising discovery.\u00a0 Most of the companies fabricate for the Government, but very few of them had any direct sales to the Defense Department.\u00a0 Many companies had a registered CAGE code, which is required to sell to the Government, but quite a few were expired.\u00a0 It is apparent that these companies must be selling through a third party, possibly a prime contractor instead of selling directly to the Department of Defense (DOD).\u00a0 Is it possible that these companies tried to find defense contracts, but were unsuccessful?<\/p>\n

So we asked ourselves why, and begun to speculate.\u00a0 Could it be that these companies simply have no experience in dealing directly with the Government?\u00a0 Are they lacking the required personnel to navigate the murky waters of defense contracting?\u00a0 Is it simply easier to sell to a prime contractor, who then has to deal with the extensive documentation, government inspections, packaging requirements and other inconveniences?\u00a0 Is it possible that companies have tried to find defense contracts, but were unsuccessful?<\/p>\n

As with many industries that we analyze, the bulk of the defense contracts are awarded to a handful of large companies, who then subcontract to smaller companies.\u00a0 This is the opposite of what the Defense Department is trying to encourage, which is greater competition<\/a>.\u00a0 In February of 2010, the Defense Department issued an interim rule to increase competition in major defense acquisition programs, in an effort to trim defense spending.\u00a0 As a result, prime contractors are required to provide technical data packages that were once considered proprietary information, making it easier for smaller companies to produce the same goods.\u00a0 This is part of an ongoing initiative at the Defense Department to increase competition for hard to find items.<\/p>\n

MISSED OPPORTUNITIES<\/p>\n

At BidLink, we speak with thousands of companies who are looking to do business with the Government, and have found some distinct patterns.\u00a0 Unless the company has experience with Government sales, we often find that they are not classified correctly, or simply using the wrong terminology to search for Government bids. When searching for defense contracts, one has to think the way the Government thinks, which is not always intuitive to civilian contractors.<\/p>\n

Buying agencies provide different information when submitting a Request for Quotation (RFQ), which can vary greatly from center to center.\u00a0 Although the Fab 40 was based on companies who produce items under the NAICS subclass 332, not every agency includes a NAICS code in their solicitations.\u00a0 Some reference Federal Supply Classes (FSC), military specifications or particular keywords to describe the requirement.\u00a0 For example, NAICS 332116 has the title “Metal Stamping”, but contracts for this category can also be found under FSCs 9905, J038, 3445, 6625, 9640, 3426, 6160, 9910, 3442, 5335, 1560, 5365, 8140, 5340, 8115, 2510, 9520, 2590 and 5975.\u00a0 A combination search for this FSC list and the keyword “Washer” or “Shim” would yield more accurate results.<\/p>\n

The NAICS Classification System is an industry classification system, not a product classification system and therefore neither intended nor well suited for this purpose.\u00a0 It was originally developed by the Office of Management and Budget (OMB) as the standard for use by Federal statistical agencies in classifying business establishments for the collection, tabulation, presentation, and analysis of statistical data describing the U.S. economy. The current classification system is the 2007 NAICS.\u00a0 The initial classification system was a 4-digit code known as the Standard Industrial Classification (SIC) system and was replaced by the 6-digit code the NAICS in 1997.\u00a0\u00a0 Although NAICS is not perfect, it is an improvement over SIC.<\/p>\n

The product classification system which the DOD utilizes is called the Federal Catalog Program and was established in 1952.\u00a0 This system which is currently in use by the\u00a0 Army, Navy, Air Force, Marine Corps, other DOD activities, civil agencies and foreign governments. The most important fact to remember is that the government buys things, they don’t buy manufacturing processes.\u00a0 It classifies items of supply based on the characteristics of the item, answering the simple question,\u00a0 “What is it?”\u00a0 How it is manufactured is irrelevant.<\/p>\n

Example:
\nPLATE, STRUCTUAL
\nNSN 1560-01-578-9126
\nBOEING P\/N 30-2922<\/p>\n

Within the technical characteristics, aluminum alloy 2024 is listed as the material. This item could be something that a fabricator is capable of machining or welding and could possibly produce. Solicitations do not list in the bid how the item is to manufactured (the process of manufacture) using words such as welding, machining or laser cutting. They list the basics such as the Item Name, part number and quantity.\u00a0 Searching the technical characteristics is the key to finding bids like this.<\/p>\n

A BETTER WAY<\/p>\n

    \n
  1. Set up bid searches using Federal Cataloging codes and terminology describing the item and not how it is manufactured. For example,\u00a0 use the word “PLATE” instead of “welding”, or “stamping”.<\/li>\n
  2. When viewing the open bids quickly glance at the technical characteristics, and item name.<\/li>\n
  3. Look at past procurement pricing history \/ number of buys \/ quantities sold per order.<\/li>\n
  4. View the number of sources for a single item.<\/li>\n<\/ol>\n

    Once this data is reviewed you can decide to continue if certain criteria are met by your own checklist.\u00a0 If you see that an item is repeatedly purchased or has only one supplier, then it may be worth investigating.\u00a0 If you can compete, submit a bid and possibly win the business.<\/p>\n

    THE NUMBERS<\/p>\n

    Although there are better ways to find Government business, the Fab 40 was based on NAICS, so we examined sales to the Defense Department for three NAICS codes under the 332 group for the first half of 2011. What is interesting is that although some of the Fab 40 companies supply goods to the Government, none of them appear in this list.<\/p>\n

    332116 – Metal Stamping<\/p>\n

    332510 – Hardware Manufacturing<\/p>\n

    332992 – Small Arms Ammunition Manufacturing<\/p>\n

    The chart below is an analysis of suppliers of the above NAICS codes to the Defense Department.<\/p>\n

    \"Top<\/a>
    Top 10 Defense Fabricators January - June 2011<\/figcaption><\/figure>\n

    Is it possible that business is being lost because fabricators are too focused on the NAICS classification system?<\/p>\n

    BidLink.net is a provider of defense industry information for contractors worldwide.\u00a0 This data includes\u00a0millions of defense contracts, procurement history, part numbers and vendor details.\u00a0 This unique combination of resources allows BidLink to monitor and extract important information for the defense contracting industry.\u00a0 BidLink.net<\/a>, based in\u00a0Washington, D.C.,\u00a0provides bid consolidation, searching and notification services, as well as part number (NSN) lookup<\/a> to\u00a0many military activities and thousands of private companies around the world.<\/p>\n

    Comments?\u00a0 Send them to news@bidlink.net.<\/p>\n

    This article was written exclusively for “The Fabricator” magazine.<\/p>\n

    http:\/\/www.thefabricator.com<\/a><\/p>\n\t\t\tTweet<\/a>","protected":false},"excerpt":{"rendered":"

    By Thomas Gerbe, Defense Information Analyst, BidLink.net We compared the top 10 companies from the Fab 40 against our database of defense contracts and made a surprising discovery.\u00a0 Most of the companies fabricate for the Government, but very few of them had any direct sales to the Defense Department.\u00a0 Many companies had a registered CAGE … <\/p>\n

    Continue reading “Fabrication for the Defense Industry”<\/span><\/a><\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-788","post","type-post","status-publish","format-standard","hentry","category-industry_news"],"_links":{"self":[{"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/posts\/788","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/comments?post=788"}],"version-history":[{"count":32,"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/posts\/788\/revisions"}],"predecessor-version":[{"id":824,"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/posts\/788\/revisions\/824"}],"wp:attachment":[{"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/media?parent=788"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/categories?post=788"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bidlink.net\/news\/wp-json\/wp\/v2\/tags?post=788"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}