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Government Contracting : Classifications :
Small Business Classification
A small business concern, as defined by the SBA, is one that is:
- Independently owned and operated
- Organized for profit
- Is not dominant in its field
Depending on the industry, size standard eligibility is based on the average number of employees for the preceding twelve months or on sales volume averaged over a three-year period.
- Q. What are the benefits to being certified as a Small Business?
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All contracts for supplies, equipment and services totaling over $500,000, and all contracts over $1,000,000 must have a subcontracting plan. To ensure that small businesses get their fair share, the Small Business Administration negotiates annual procurement preference goals with each Federal agency and reviews each agency's results. The statutory goals for Federal agencies are to assign 23 percent of prime contracts to small businesses.
- Q. What are the basic requirements an 8(a) applicant firm must meet?
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To be considered a small business, a firm must be:
- Independently owned or operated
- Not dominant in the field under which it is pursuing government contracts
- Qualified under the NAICS criteria in 13 CFR part 121.
Examples of SBA general size standards include the following:
- Manufacturing: Maximum number of employees may range from 500 to 1500, depending on the type of product manufactured;
- Wholesaling: Maximum number of employees may range from 100 to 500 depending on the particular product being provided;
- Services: Annual receipts may not exceed $2.5 to $21.5 million, depending on the particular service being provided;
- Retailing: Annual receipts may not exceed $5.0 to $21.0 million, depending on the particular product being provided;
- General and Heavy Construction: General construction annual receipts may not exceed $13.5 to $17 million, depending on the type of construction;
- Special Trade Construction: Annual receipts may not exceed $7 million; and
- Agriculture: Annual receipts may not exceed $0.5 to $9.0 million, depending on the agricultural product.
- Q. How do I certify/classify as a Small Business?
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Companies may classify themselves as a small business.
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