Consulting Giants in the Crosshairs: How Trump’s Spending Spree Crackdown Could Be a Goldmine for Your Small Business
If you listen closely, you can hear the faint rustling of PowerPoint decks being shredded in boardrooms from McLean to Manhattan.
That’s because the Trump administration, has declared war on bloated federal consulting contracts. And in this plot twist, David (a.k.a. small business owners) might finally get a shot at beating Goliath.
Here’s the scoop: Through the newly created Department of Government Efficiency (DOGE)—yes, that’s the real acronym—the Trump administration has embarked on a federal cost-cutting initiative so aggressive, it makes “The Apprentice” boardroom firings look tame.
The $65 Billion Bullseye: Trump’s Consulting Hit List
Ten of the largest federal consulting firms are now in the hot seat. Their offense? Collectively standing to earn more than $65 billion in consulting fees for 2025 and beyond.
The top 10 firms targeted by the DOGE directive include:
Deloitte
Accenture Federal Services
Booz Allen Hamilton
IBM
Leidos
Guidehouse
Science Applications International Corporation (SAIC)
Hill Mission Technologies Corp.
CGI Federal
General Dynamics
In late February, the General Services Administration (GSA) issued a memo giving agencies until March 7 to “justify every contract” or prepare for cuts. The results? Over 1,700 contracts got the axe, saving $4.5 billion. The Department of Veterans Affairs alone slashed 585 contracts worth nearly $2 billion—though after public backlash, some cuts were paused.
For consulting titans, the cuts are already stinging. Deloitte reportedly lost 129 contracts, amounting to at least $372 million in claimed savings. Booz Allen offered $1 billion in proposed cuts, including a shift to performance-based pricing and identifying projects that could be insourced by federal agencies.
Leidos, another large contractor, proposed efficiency measures without disclosing a dollar figure, while Accenture and IBM remained tight-lipped. As a result, stock prices have tumbled—Booz Allen is down 40%, Leidos 30%, and Accenture 12%—outpacing the broader S&P 500’s 5% drop.
This isn’t just a budget trim—it’s a recalibration of how the federal government engages with its contractors. And with the administration signaling further layoffs of up to 80,000 federal employees, the demand for lean, efficient outsourcing solutions may actually grow—even as the margins shrink.
Consulting’s "Oh No" Moment: Cuts, Stocks, and Scrambling Execs
The fallout? Consulting firms are panicking like it’s a government shutdown on steroids.
Booz Allen Hamilton—which gets nearly all of its $11B annual revenue from Uncle Sam—offered $1 billion in savings and identified contracts to cancel or shift to performance-based pricing. CEO Horacio Rozanski even suggested, gasp, that the government insource some work.
Leidos provided “detailed options” to improve federal efficiency but didn’t name a dollar figure.
Accenture's CEO Julie Sweet reported slowed sales as agencies hit the brakes on new contracts. The company has taken a 12% stock hit since the election. Booz Allen? Down 40%. Leidos? Down 30%.
Meanwhile, GSA procurement chief Josh Gruenbaum—a private equity alum who once helped companies grow—is now helping shrink federal expenses.
Enter the Underdog: Why Small Businesses Should Be Paying Attention
Here’s the fun part: This chaos in the C-suites might be your big break.
While billion-dollar firms argue over which PowerPoint decks to delete, small businesses have a rare chance to step into mission-critical roles that agencies still need filled. Here’s why your small business can be competitive.
1. You’re Leaner, Faster, Cheaper—and That’s the Point
Agencies are under pressure to justify every dollar. Your small firm isn’t bundling high-level strategy with 12 months of vague “advisory” services—you’re solving problems now with lower overhead. That’s what the government wants.
2. Performance-Based Contracts = Your Playground
DOGE loves outcomes. You can deliver better results for less? That’s the ticket. The consulting Goliaths are pivoting to this model; you might already be built for it.
3. Primes Need You to Help Them Look Good
Big firms are sweating. They may be forced to team with smaller partners to justify pricing. If you can plug into their contracts as a cost-efficient, nimble subcontractor, you’ll be doing them a favor while getting your foot in the door.
4. Canceled Doesn’t Mean “Not Needed”
Agencies still need services—they just can’t justify high-dollar contracts with vague deliverables. If you offer something specific, essential, and affordable, you’re not just wanted—you’re needed.
The Big Picture: Consulting Is Being Rewritten
For decades, big consulting firms built empires on federal contracts. But now, with agencies slicing budgets, lawmakers arguing about what counts as “waste,” and watchdogs questioning DOGE’s math, we’re entering a new era.
It’s a shift from “just keep the lights on” consulting to results-driven partnerships. It’s the government asking not “who do we know?” but “what will we get?”
And that’s exactly where small businesses can win.
Tips for Getting Started
Register in SAM.gov and maintain an active profile.
Certify for small business programs (8(a), HUBZone, WOSB, SDVOSB).
Research the OASIS and GSA Schedules to see where your capabilities fit.
Monitor contracting opportunities on SAM.gov and FPDS.
Network with prime contractors—especially those feeling the heat.
Reach out to our team at Squared Compass to learn how we can help you win government work.
