Home Business Government Contracting 101 for Small Businesses: An SBA Guide

Government Contracting 101 for Small Businesses: An SBA Guide


Navigating the competitive landscape of government contracting can be challenging, particularly for smaller enterprises. However, the Small Business Administration (SBA) plays a crucial role in leveling the playing field, empowering small businesses to secure contracts, expand their opportunities, and deliver services to government agencies effectively.

Introduction to the Small Business Administration (SBA)

Established in 1953 by President Eisenhower through the Small Business Act, the SBA is an independent agency dedicated to supporting and advocating for small businesses across the United States. Its primary mission is to enhance the competitiveness of small businesses in the marketplace.

Key Services Provided by the SBA

The SBA offers a range of services designed to foster growth and success in the competitive government contracting environment:

Access to Capital: The SBA provides financial resources through various programs such as small loans, microloans for disaster relief, and loan guarantees. These funds are crucial for small businesses that may not qualify for financing from larger lenders.

Contracting Opportunities: The SBA allocates 23% of federal contract dollars to small businesses, with specific set-asides for disabled veterans (3%) and women entrepreneurs (5%). These programs aim to increase small business participation in federal contracting.

Entrepreneurial Development: Through counseling, training, and mentorship programs offered in over 1,000 locations nationwide, the SBA supports both new and existing entrepreneurs. These resources help small business owners navigate the complexities of government contracting and improve their competitiveness.

Advocacy: The SBA advocates for small businesses by reviewing legislation and defending their interests at both state and federal levels. This advocacy ensures that small businesses have a voice in policy decisions affecting their operations.

Criteria for Small Businesses

To qualify for SBA programs and government contracting opportunities, businesses must meet specific size standards defined by the Code of Federal Regulations (CFR). These standards consider factors such as annual receipts, number of employees, and affiliation with other businesses.

Additional Considerations

Business Eligibility: Small businesses seeking SBA assistance must be for-profit entities of any legal structure, independently owned and operated, and physically located and operated in the United States or its territories.

Compliance with Regulations: Businesses must comply with federal contracting regulations, including the Federal Acquisition Regulation (FAR), which governs the purchasing processes of federal agencies, and the CFR, which outlines standards for SBA contracting programs.

Cybersecurity Requirements: Small businesses contracting with the Department of Defense (DOD) must meet cybersecurity standards outlined in the Cybersecurity Maturity Model Certification (CMMC). Compliance with these standards ensures the protection of sensitive data and systems.

Steps to Qualify for Government Contracting

Register with SAM: Businesses must register with the System for Award Management (SAM), where their eligibility for government contracts is validated and maintained. SAM registration is essential for accessing federal contracting opportunities.

Obtain Identification Numbers: Businesses should obtain a Unique Entity Identifier (UEI) and a North American Industry Classification System (NAICS) code. The UEI simplifies business identification and validation, while the NAICS code categorizes businesses based on their products or services.

Compliance with Federal Contracting Regulations: Ensure adherence to federal regulations such as the FAR, CFR, and relevant labor standards statutes, which govern various aspects of government contracting.


By providing essential resources, advocacy, and compliance guidance, the SBA empowers small businesses to compete and succeed in government contracting. Whether through financial assistance, contracting opportunities, or regulatory support, the SBA remains committed to fostering the growth and resilience of small businesses across the United States.