FIGURE 4-2 Sales by sales range.

FIGURE 4-2 Sales by sales range.

SOURCE: NRC Phase II Survey.

contracts between 1999 to 2001 was only $982,000. This difference in part reflects the number of recent awardees whose products have yet to be commercially introduced or fully exploited commercially. Reported aggregate and average sales data up through the survey date of May 2005 are therefore only a partial estimate of the total commercial impact of the 920 awards covered by the NRC Phase II Survey.14 According to former senior DoD staff, average major DoD weapons system R&D cycle is approximately 12 years (before production)—so SBIR


Using the trendline shown in Figure 4-3, we find that the best fit generates average sales of approximately $5.5 million per project for those with awards in 1992, declining to averages sales of $1 million for those in 2001. Note that these data cover only firms reporting some sales. The trendline gives us a means of estimating the eventual sales generated by each project, using simplified assumptions (notably, that all sales end by May 2005 (the date of the NRC Phase II Survey), and that commercialization remains constant across time (in fact, it is likely to have increased as agencies have increased their focus on supporting projects with better prospects of commercial success). Other assumptions tend to reduce the size of the estimated revenues.

Using these estimates to project forward, we find that by the time commercialization of all projects is completed (i.e., ten years after the last project funded, or 2011), total revenues generated by the projects reporting revenues so far is $2.13 billion.

These data suggest that the reported revenues as of May 2005 may understate eventual total revenues as of 2011 by as much as 50 percent.

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