If you would like to do business with the federal government, there are several certification programs that can help you gain competitive advantage. To qualify for federal certification as a minority or disadvantaged business, your business must also meet the federal government’s definition of a small business.
Definition of a Small Business The U.S. Small Business Administration defines a small business concern as one that is independently owned and operated, is organized for profit, and is not dominant in its field.
Depending on the industry, size standard eligibility is based on the average number of employees for the preceding twelve months or on sales volume averaged over a three-year period. Examples of SBA general size standards include the following:
- Manufacturing: Maximum number of employees may range from 500 to 1500, depending on the type of product manufactured.
- Wholesaling: Maximum number of employees may range from 100 to 500 depending on the particular product being provided.
- Services: Annual receipts may not exceed $2.5 to $21.5 million, depending on the particular service being provided. For example, most general service businesses may not exceed $6 million in annual receipts while architectural, engineering, carpet cleaning, and dry cleaning have a threshold of $4 million.
- Retailing: Annual receipts may not exceed $5.0 to $21.0 million, depending on the particular product being provided.
- General and Heavy Construction: General construction annual receipts may not exceed $13.5 to $17 million, depending on the type of construction.
- Special Trade Construction: Annual receipts may not exceed $7 million.
- Agriculture: Annual receipts may not exceed $0.5 to $9.0 million, depending on the agricultural product.
If the size of a business exceeds the size standard for its overall industry group, it may still be a small business for the specific type of service provided in that group. Some industries have higher size standards than the general one for the industry group. Check the SBA Table of Size Standards for more specific information.
Certification Programs Once you determine that your business qualifies as a small business, you can explore specific minority- and veteran-owned certification options that provide additional incentives when contracting with the federal government.
Click on the titles to learn more about the benefits and eligibility requirements for each type of program.
SBA program created to help small disadvantaged businesses compete in the American economy and access the federal procurement market. Minority-owned firms that qualify for this program automatically receive SDB certification.
SBA program that provides minority- and woman-owned firms with competitive advantage in federal procurements. There are less stringent certification requirements than the 8(a) program but also less benefits.
SBA program that allows small firms located in many urban or rural areas to qualify for sole-source and other types of federal contract benefits. HUBZone stands for “historically underutilized business zone,” which are areas that have been targeted to enhance economic vitality.
Self-certifying program that provides service-connected veteran-owned businesses with set-aside opportunities and contracting preference for certain types of federal procurements.