Federal agencies are legally required to set aside 23% of all contracts for small businesses. These agencies are also required to set aside a specific number of contracts for business owners who meet specific socioeconomic criteria:
- 5 percent of prime and subcontracts for women-owned small businesses
- 5 percent of prime and subcontracts for small disadvantaged businesses
- 3 percent of prime and subcontracts for HUBZone small businesses
- 3 percent of prime and subcontracts for service-disabled veteran-owned small businesses
The groups covered by these goals are small businesses that:
- Are owned and controlled by service-disabled veterans, or
- Qualify for HUBZone certification, or
- Are owned and operated by socially and/or economically disadvantaged individuals
- Are owned and controlled by women
It is not enough to simply self-certify as one or more of these socioeconomic groups. The SBA must certify you as one or more of these groups. The process for earning certification is involved and sometimes complicated. It is recommended that you work with a third-party government registration firm to help you earn your certification.