Small business set-aside

FAR Part 19 governs small business programs. Under the long-standing "rule of two", a contracting officer sets a purchase aside for small businesses when there is a reasonable expectation of offers from at least two responsible small businesses at fair market prices. Market research, including sources sought notices, is how the contracting officer finds out.

Socioeconomic set-asides go further and restrict competition to 8(a), HUBZone, SDVOSB or WOSB firms. Part 19 is among the parts rewritten in the FAR overhaul, so check the current text for the exact order of preference and thresholds.

Eligibility turns on the solicitation's NAICS code and its size standard, plus any certification required. Winning a set-aside also brings limitations on subcontracting, which cap how much of the work can go to firms that are not similarly situated.

Common mistakes: assuming you are small for every code, teaming with a large firm that does the main work (the ostensible subcontractor rule), and missing that certifications must be current at the time of offer. States run their own small and disadvantaged business programs with separate certifications.

Set-asides also shape strategy beyond eligibility. Watching which of your target agencies set aside work in your codes, and for which programs, tells you where a certification will actually produce opportunities. Responding to sources sought notices matters here too: a capable small business response is part of the market research a contracting officer uses to decide whether a set-aside is possible, so a short, specific reply can influence whether the final RFP is open to you at all.