The U.S. Small Business Administration (SBA) works with other agencies in the Federal Government to help small businesses obtain government contracts. Many federal agencies must award some of their contracting opportunities to small businesses, creating opportunities for small businesses to grow.
The SBA provides guidelines that define which small businesses qualify within their respective industries. The SBA standards measure the number of employees a business has over the last 12 months and the receipts over the last three years. The SBA also determines small business status using the following elements:
- The business is for-profit
- The place of business and operations are within the U.S.
- The business is not nationally recognized as a business in its field
- Whether the business is under independent ownership and operation
To determine whether your business qualifies, use the SBA Size Standards Tool.
The SBA operates several programs that help small businesses obtain government contracts.
- Historically Underutilized Business Zones (HUBZones): Small businesses that meet the SBA’s small business definition and also meets the requirements for being within a HUBZone may receive additional benefits when contracting with the government.
- Service-Disabled Veteran-Owned Businesses: A portion of government contracts are set aside for service-disabled owned and controlled small businesses.
- Women-Owned Small Businesses: A portion of government contract opportunities are set aside.
There are a few steps to complete before applying for government contracts once you know your business qualifies.
- Each business location must register to receive an identification number called a D-U-N-S Number.
- Register with the System of Award Management (SAM) database.
- Locate your business’ North American Indsutry Classification System (NAICS) code. This will correspond to your business’ location, sector, and industry.
- Businesses interested in U.S. General Services Administration (GSA) contracts should also have an independent audit of their performance through Open Ratings, Inc. Past Performance Evaluation.
You may not need a business lawyer in order to register as a small business and explore contracting opportunities. However, if you have any questions about signing or negotiating a government contract, you should contact an attorney with experience handling government contracts.