Summary: The Small Business Administration (SBA) uses size standards to determibility for Federal Small Business Assistance programs, but many of the size standards do not direct assistance to the target group of businesses which are "struggling to become or remain competitive." It was found that the standands often define as small a high percentage of industry firms controlling most of an industry's sales. An analysis of Federal timber sales showed that companies with less than 100 employees, and especially those with 25 or fewer, have used the set-aside program less than companies with more than 100 employees. Although companies did not compete as successfully for set-aside sales as they did for open sales, it appeared that the smaller firms especially need the set-aside program because they are the firms that most often fail. It was recommended that the Administrator of SBA should determine, in accordance with regulations, the size businesses in each industry which are struggling to become or remain competitive, and determine the size of businesses which need set-aside protection because they cannot otherwise obtain Federal contracts. It was suggested that size standards may have to be reduced or changed to aid small businesses which neeed procurement assistance in order to remain competitive.
