Whether you’re just beginning to explore what it might look like to be a federal government contractor or you’ve been a small business government contractor for years, there are a few things that you may not know about the small business set-aside authority. Today we’d like to unpack five little-known facts so you can have a better understanding of how the small business set-aside authority works.
5 Must Know Facts About the Small Business Set-Aside Authority
- It’s not a handout, so don’t view it as one. It is the declared policy of the Congress to ensure that a fair proportion of the total purchases and contracts or subcontracts for property and services for the government be placed with small business enterprises. It’s an important piece of developing the underlying economy and creating innovation and success for the agency mission. It’s not a favor. It’s congressional intent.
- You won’t automatically get a contract because you qualify. You have to create value for the buyer. SBA works with each federal agency annually to establish a goal that presents, for that agency, the maximum practicable opportunity for small business concerns.
- Set asides have specific requirements. Federal law streamlines government purchasing for buys under $250,000. Below the simplified acquisition threshold of $250,000 but above the micro-purchase threshold of $10,000, everything is reserved for small businesses. The opportunities here are vast.
- Rule of 2. Acquisitions over $250,000 shall be set aside for small businesses when there is a reasonable expectation that offers shall be obtained from at least two responsible small businesses.
- The language of “shall” versus “may” in “government speak” is noteworthy. It’s the difference between a requirement and a choice. If there is an opportunity that you find that should be set aside for small business but is not, that is a great opportunity to engage your procurement center representative (PCR). Each federal buying activity has a PCR who advocates for small businesses within that buying activity to help ensure the procedures above are being followed and help small businesses win federal contracts. PCRs view many federal acquisition and procurement strategies before they’re announced. This enables them to influence opportunities that should be set aside for small businesses. Do your homework and learn who covers your buying activity.
The world of government contracting can be difficult to navigate, but there just may be opportunities for your small business to thrive thanks to the rules listed above.
If you’d like to learn how GovContractPros can help your business to access the $500 billion marketplace, get in touch here.