small business set aside program

How Does the Small Business Set Aside Program Work?

Small businesses can get in on the action of GSA Schedules by being part of the government’s small business set aside program through the Small Business Administration (SBA).

The government’s small business set aside program is designed to help disadvantaged businesses overcome the hurdle of gaining federal agency’s business. Whether it’s an economic or social disadvantage, your business might be able to receive special benefits to help you break into the realm of government contracting.

Government contracting opens a whole new stream of revenue for businesses who can successfully obtain a contract and garner bids for their products and services from federal agencies. While it may seem like a simple path to success, in reality, only about 40% of businesses see a share of the billions that federal agencies spend annually on GSA Schedules.

This figure comes as a surprise to many business owners, and the problem can occur for a number of different reasons. Within certain schedules, typically the ones that are the most popular, there might be a lot of companies vying for bids, making your chances of winning lower. Often when it’s a business’s first time using a government contract, they might not know how to competitively price your products or services to make their business stand out. Especially when small businesses are concerned, issues like these can quickly lead to being overlooked and struggling to win a bid.

The small business set aside program helps to give small businesses a better chance to provide their products or services to the government by specifically putting aside sales and designating it for small businesses. Generally, portions of purchases that are over $3,000 but under $150,000 are automatically reserved for small businesses in order to ensure there are bids available for them. For this to happen, there has to be two small businesses that are competitive in that industry for the sales to automatically be set aside. This is referred to as the Rule of Two, and it applies to all contracts across the board.

However, not just any small business can come in and claim their share of set asides. The trick to being able to take advantage of the small business set aside program is to make sure you are actually designated as a small business with a certification.

How to Get Started With the Small Business Set Aside Program

For many small businesses, getting involved with government contracting can seem like a goal that’s far out of reach. Unfortunately, it’s common for small businesses to not go through the process of being certified, because they don’t realize what advantages it can provide to be recognized as a small business.

In order to take advantage of the small business set aside program and start expanding your business through government contracting, you have to be certified. A small business certification is the designation they need to receive the special benefits the government created for small businesses.

There are several different types of small business certifications that include special designations for women and veterans. If you want to become certified as a small business you may qualify for one of these four certifications:

  • SBA 8(a) Certification
  • Service Disabled Veteran Owned Small Business (SDVOSB) Certification
  • Veteran Owned Small Business (VOSB) Certification
  • Women Owned Small Business (WOSB) Certification
  • HUBZone Certification

Through one of these certifications, you’ll be able to take part in the small business set aside program once you are approved for a GSA Schedule. Depending on which one you have, there are different opportunities for set asides that may be designated specifically for your type of certification. Others are made available for all small businesses.

With a GSA Schedule, your business can expand its customer base and revenue by providing your products or services to the government. About 10% of all government spending goes through GSA Schedules, so there is a great deal of opportunity for businesses to find success.

The small business set aside program makes government contracting available to everyone. If you’re a small business, don’t rule yourself out from starting the path to a GSA Schedule. With the right tools and a good understanding of how the process works, any business can find success through government contracting. The benefit for small businesses is that you don’t have to worry about losing out to larger companies who are able to offer lower costs. The small business set aside program almost guarantees that your business will be able to secure a bid from a federal agency, and that your only competition will be other companies that are the same size as you.

If you’re interested in a GSA Schedule, the benefits as a small business and added revenue await you. Find out if you’re qualified for a small business certification and get started on the path to government contracting success today.


At Capitol 50 Consultants Inc the team has specialized in helping businesses have successful relationships with the government for over 25 years. Looking for a hassle-free path to winning a government contract? We’ve got you covered.


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