Air Force Research Laboratory spending on small businesses in Ohio jumped to $345.6 million in 2017, with the Dayton region landing more dollars than any place in the state, AFRL data shows.
A large amount of the spending fell on large firms, although mall businesses took a larger slice of AFRL contract spending, reaching a 47.8 percent in fiscal year 2017, according to Bill Harrison, director of AFRL’s small business program at Wright-Patterson Air Force Base.
“We’re doing that because we’re really trying to drive innovation, and many people believe, I believe, that innovation is in the small business community,” Harrison said.
The Dayton region claimed more than 90 percent of AFRL’s Ohio business contracts in 2017, up from 78 percent in 2013, according to the Dayton Development Coalition.
Overall, AFRL contract obligations increased 75 percent in the Dayton region between 2013 to 2017, according to the DDC.
AFRL contracts with both large and small firms reached $551.2 million in Ohio, data shows. Spending with large firms declined to $205.9 million, a drop of $80 million from the prior year.
Nationwide, AFRL spent more than $1.4 billion with small businesses out of $3 billion awarded in contracts, the research agency’s numbers show.
The Dayton region pulled in the biggest share of Ohio dollars spent on those contracts, reaching $507.3 billion of the state’s total last fiscal year, and a jump of $90 million from the prior year.
Beavercreek-based Sawdey Solutions, Inc., a defense contractor that offers professional services, has landed six AFRL contracts and $40.8 million in business over the past three years, according to the company.
Small businesses such as Sawdey have lower overhead costs, an advantage over bigger defense competitors, said Jeff Sawdey, company vice president.
“I think anytime you compare a small business to a large business, probably the first indicator that is going to come out in the wash is the price,” he said. “Assuming you can compete technically, it places you on a better footing simply at a better cost to the government.”
With the higher contract spending, cyber firms and small business manufacturers have had strong defense-related growth in the region, according to Deborah Gross, executive director of the Dayton Area Defense Contractors Association.
“The more dollars that we can get in this community out of Wright-Patterson Air Force Base, it’s just a win-win, all around,” she said.
AFRL is headquartered at Wright-Patterson and has four of its nine directorates at Miami Valley locale: Aerospace Systems, Materials and Manufacturing, Sensors, and the 711th Human Performance Wing, which includes the Air Force School of Aerospace Medicine.
Between 2013-17, the Dayton region claimed more than $1.9 billion, or about 80 percent of AFRL’s nearly $2.4 billion committed to businesses in Ohio, the DDC reported.
Maurice McDonald, Dayton Development Coalition executive vice president of aerospace and defense, said the message to companies across the nation is the they have a better opportunity to land an AFRL contract if they have a presence in the Dayton area.
Greene and Montgomery counties easily led the state last year in contract awards. Greene County had $410.2 million in contacts for both large and small firms and Montgomery recorded $97.1 million in fiscal year 2017, AFRL data shows.
Cuyahoga and Hamilton counties were the closest but trailed with $13.2 million and $11.5 million respectively, data shows.
Ohio received nearly $2.4 billion, or about a fifth of AFRL’s $11.5 billion in contracts between fiscal year 2013-17, DDC reported.
Harrison said he can’t predict if the trend to spend more with small businesses will continue because requirements change year to year.
In recent years, as part of a drive to expand small business contracts, AFRL has pushed to commercialize technology developed in the lab, which has also led to seven tech start-ups in the Dayton region, officials said. In total, AFRL counts 36 start-ups, most out of the Commercialization Academy tied to the Information Directorate in Rome, N.Y., officials said.
“Each one of our community ecosystems is different,” he said. “It’s taking us a couple of years, but we’ve got more in the works.”