Small Business Certifications Qualify for Set-Aside Contracts

Over $630 Billion in spending was awarded to Government contractors in FY 2022. According to the SBA, 23% of all Government contracting dollars was budgeted to go to small businesses. However, in FY 2022, small business set-asides exceeded their budget by an additional 3.5%. That’s an over a $162.9 Billion investment into the small business economy.

 

Do you qualify for a small business certification?

First of all, you must be a small business. By SBA standards, a small business is one with 500 or fewer employees. Other factors that contribute to your size include your average annual receipts and the value of its assets. There are industry-targeted specifications. If you are uncertain of your size, you should consider reviewing the SBA’s Table of Small Business Size Standards for more clarification.

Did you know that the size standards can change? They adjusted the standard on December 19, 2022. Anyone already registered in SAM must adjust their size if they’re affected.

 

Set Aside Contracts for Small Business Certifications

While small businesses were budgeted 23% of total Government spending, socio-economically certified businesses get a dedicated portion of the budget. These set aside contracts are available to businesses certified as women-owned, service-disabled veteran-owned, small disadvantaged businesses, and HUBZone. Here is the budget breakdown:

Small Businesses Qualify for Socio-Economic Certification

Four main groups qualify for small business certification.

• Women-Owned Small Business (WOSB certification)
• Veteran or Service-Disabled Veteran Owned Small Business (VOSB/SDVOSB certification)
• Minority Owned Small Business (8a certification)
• HUBZone Certified Small Business (HUBZone certification)

Each of them has its own set of requirements to qualify for the certification. The main requirement that is the same across all certifications is that the business must be classified as a small business. They also need to be at least 51% owned by Women, Veteran, or Minority respectively. HUBZone certification has its own set of qualifiers.

Women Owned Small Business

This program was designed to level the playing field for women business owners in Government contracting. It makes it easier for women-owned businesses to compete for and win contracts. It allows women to form joint ventures and teams by way of building relationships with Primes and other contractors. The program assists women in increasing their revenue and growing their businesses at an exponential rate.

To determine eligibility, we would submit a completed application and your documentation to the SBA on your behalf. The SBA then verifies the information on your application and your supporting documentation. They will approve or deny your application within 90 days. It seems like a long time, but the SBA will process your application as quickly as possible.

Veteran or Service-Disabled Veteran Owned Small Business

Both a VOSB and an SDVOSB qualify a small business for set-aside contracts. These programs recently moved to the SBA from the VA for processing applications and verifying businesses. All supporting documentation must be submitted with the application and the SBA can take up to 90 days to process. The process is very similar to the WOSB program. Since the SBA takeover, applications have been approved at a rapid pace compared to the long wait times we previously saw from the VA.

This certification gives you priority treatment when it comes to procurement. Agencies like the Department of Veteran Affairs have special programs for both VOSB and SDVOSB. These programs help find the right contacts and submit bids to the right contractors. The VA is required to use veterans and service-disabled veterans on a percentage of their contracts. Most simply prefer to give the awards to those who have sacrificed for America’s freedom.

Minority Owned Small Business or an 8(a) Certification

The 8(a) certification program is different than both the WOSB and VOSB/SDVOSB. This program has a time stipulation. You can be in the program for a total of 9 years. These years are broken into two phases: a four-year developmental stage and a five-year transition stage. Businesses that participate in this program must be owned and controlled by a socially or economically disadvantaged individual. As the owner, you must submit a narrative as well as personal financial documents about your income, assets, and net worth.

We can apply for this certification on your behalf and submit all the required documents to the SBA. The SBA will process your application and determine if you qualify by verifying your documentation. Just like the other two certifications, it could take up to 90 days for an approval or denial decision.

HUBZone Certification

This program is designed to stimulate economic development in urban and rural communities. These are “Historically Underutilized Business Zones.” Your business must be located within a HUBZone and 35% of your employees must reside within a HUBZone. The other main qualification requirement is being 51% owned by a US citizen, small according to SBA size standards, and in good standing to do business.

How can Select GCR Help?

Your time is a valuable thing. I’m sure you have plenty on your plate as a business owner. Do you have enough time in your day to sit in front of a computer for hours to complete an application? You likely don’t have even 20 minutes to spend on one task. You will need longer to complete the application process.

Not only do you have to apply, but you also must submit the required documentation. Knowing what documents you need for verification before applying is key. Our team of processors has the experience to know what you need and will gather your documentation before we even start your application. We do all the heaving lifting for you.

We also offer renewal programs with discounts if purchased at the time of certification approval. You can set your certificate renewal on autopilot with the help of our processing department. Our team will keep track of your renewal date and guarantee approval before your time runs out.

Why go through the process alone? Why take hours out of your busy schedule to get your business certified? Have Select GCR take the burden for you. For more information on our services, call 833-336-3988 or fill out a contact form here on our site.