NDIA says small businesses report problems with meeting obligations and access to capital

The National Defense Industrial Association said today its survey of small businesses found that companies are struggling with hitting sales expectations, meeting contract obligations and getting access to capital in the midst of the coronavirus outbreak.

About 770 small businesses in the defense sector participated in the survey, which NDIA managed at the request of the Defense Department. The survey closed April 10.

NDIA said 60% of respondents reported the crisis "has interfered with their cash flow," while the same percentage said they expect the pandemic to create long-term financial and cash-flow problems.

"The technology and services sectors report more disturbances from the crisis than the manufacturing sector," NDIA said. "And businesses with fewer than 50 employees are feeling the brunt harder than businesses with more than 500 employees."

The survey also identified as areas of difficulty accessing facilities, reaching contracting officers and getting clear information from DOD, among others.

In its report, NDIA included recommendations for DOD actions made by survey respondents. Among them are that DOD should consider an "expedited testing" solution for mission-critical contract workers, that the security clearance process should be accelerated to make it easier to replace workers and that the Pentagon should seek to increase its network bandwidth or, if that's not possible, excuse contract performance delays created by bandwidth issues.

The report notes that NDIA will likely "conduct a follow-on survey at some time in the coming months to assess the ever-changing nature of the impacts of the COVID-19 crisis."