Small business set-asides are contracts reserved by the federal government that limit competition to eligible small businesses. The federal government uses small businesses when products or services can be purchased by at least two small businesses. To achieve the contractual objectives of small businesses, contracting officers often determine whether an acquisition can be made first through set-aside before opening it up to other businesses. The term “set-aside for small businesses” refers to the portion of federal contracts that must be awarded to small businesses. Every year, the federal government gets about $500 billion in private sector contracts, which means there`s a lot of work for enterprising small business owners. (c) The contract agent shall insert the clause under 52.219-6, Notice of Total Freeze for Small Enterprises, in tenders and contracts that include a total freeze or reserves for small enterprises. This includes multiple orders for which orders may be deferred for one of the small businesses referred to in paragraph 19,000(a)(3), as described in paragraphs 8 405-5 and 16,505(b)(b)(i)(F). The clause in Section 52.219-6 with its Variant I is used when the purchase of a product is made in a category for which the Small Business Administration has waived the non-manufacturer rule (see 19.102(f)(4) and (5)). Use the clause of 52.219-6 with its alternative II if you include FPI in the competition according to 19.504. It`s normal to be a little aggressive when it comes to pricing. If you shave your margins a hair in advance, you can have access to more and larger government contracts later.
But they also don`t want to go bankrupt to get the lowest bid. For the same reason, you`re targeting contracts that you`re sure you can handle – you don`t want to accept a $50 million contract only to find that you don`t have the resources or staff to close it. Start small and aim higher as you grow! (d) the contract agent shall examine each individual acquisition resulting from set-aside for small enterprises in order to determine any change in the scope of requirements, specifications, delivery requirements or competitive market conditions that has occurred since the initial approval of set-aside; If there are changes of such a significant nature that result in a likely payment of more than one fair market price by the government or a change in the ability of small businesses to meet the requirements, the contract agent may withdraw or amend the unilateral or joint freeze (see 19.506(a)) by written notification to the SBA Supply Centre representative (or if no Procurement Centre representative is assigned, see 19.402(a)) for reasons. (a) A class of acquisitions of selected goods or services or a portion of the acquisitions may be reserved for the exclusive participation of small businesses if the individual acquisitions of the class meet the criteria set out in paragraphs 19.502-1, 19.502-2 or 19.502-3(a). The decision to close a small business group should not depend on the existence of an ongoing acquisition if future acquisitions are clearly foreseeable. Qualification requirements vary depending on the type of set-aside program. (c) In the case of small enterprises which are not intended for construction or services, any enterprise wishing to supply a product which it has not produced itself must supply the product of a small contractor, unless the SBA has granted an exemption or exception to the non-manufacturer rule (see 19.102 (f)). In industries where the SBA determines that there are no small manufacturing enterprises, it may grant an exemption from the non-manufacturer rule (see 19.102(f)(4) and (5)).
In addition, the SBA has exempted from the application of non-manufacturer`s rule regulations contracts that are processed under simplified procurement procedures (see Part 13) where the estimated cost of procurement does not exceed $25,000. Exemptions allow small businesses to supply a company`s product. The exception allows small businesses to offer the product of a national company. In both cases, the decision of the contracting entity referred to in point (b)(1) of this Subsection or the decision not to cancel a purchase reserved for small enterprises in accordance with point (a) of this Subsection shall be based on the expectation of receiving tenders from at least two responsible small undertakings, including non-producers, offering products from different companies. (b) with the exception of tenders for the non-set-aside part of the partial set-aside, tenders received from undertakings which are not considered to be small undertakings shall be deemed not to respond and shall be rejected; However, before an otherwise eligible bid is rejected due to questions about size representation, a determination by the SBA must be obtained (see subsection 19.3). (b) The item is on a planning list defined under the Industry Readiness Planning Program. However, full set-aside for small enterprises may not be carried out if the list includes a large planned emergency manufacturer of the articles who has expressed a desire to supply all or part of the required articles. (c) 1. The contracting entity shall grant the non-set-aside share in accordance with the usual procurement procedures. These small business set-asides are often a great way for a small or new business to break into an industry dominated by big players – here`s what you need to know.
There are also reserved markets specifically for veterans-owned small businesses (VOSBs). The stakeholders of these eligible companies must be veterans, as described in the U.S. Code, and represent 51% of the company. .