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Types of contracts | U.S. Small Business Administration
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business</span> </a> </li> <li class="usa-sidenav__item"> <a href="/federal-contracting/contracting-guide/basic-requirements"> <span>Basic requirements</span> </a> </li> <li class="usa-sidenav__item"> <a href="/federal-contracting/contracting-guide/how-win-contracts"> <span>How to win contracts</span> </a> </li> <li class="usa-sidenav__item active active-trail"> <a class="usa-current" href="/federal-contracting/contracting-guide/types-contracts"> <span>Types of contracts</span> </a> </li> <li class="usa-sidenav__item"> <a href="/federal-contracting/contracting-guide/size-standards"> <span>Size standards</span> </a> </li> <li class="usa-sidenav__item"> <a href="/federal-contracting/contracting-guide/governing-rules-responsibilities"> <span>Governing rules and responsibilities</span> </a> </li> <li class="usa-sidenav__item last"> <a href="/federal-contracting/contracting-guide/prime-subcontracting"> <span>Prime and subcontracting</span> </a> </li> </ul> </li> <li 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js-toc-ignore">Content</h2> <nav id="sba-toc__nav" aria-labelledby="sba-toc-heading" class="sba_toc__nav sba-standard-margin-spacing"></nav> <hr role="presentation"> </div> <div class="sba-section-headings"> <h2 class="sba-section-headings" id="set-aside-contracts-for-small-businesses"> Set-aside contracts for small businesses</h2> </div> <div class="paragraph paragraph--type--text-section paragraph--view-mode--default sba-standard-margin-spacing"> <div class="usa-prose field__item" data-test="fieldItem"><p dir="ltr">To help provide a level playing field for small businesses, the government limits competition for certain contracts to small businesses. Those contracts are called “small business set-asides,” and they help small businesses compete for and win federal contracts.</p> <p dir="ltr">There are two kinds of set-aside contracts: competitive set-asides and sole-source set-asides.</p> </div> </div> <div class="sba-section-headings"> <h3 class="sba-section-headings" id="competitive-set-aside-contracts"> Competitive set-aside contracts</h3> </div> <div class="paragraph paragraph--type--text-section paragraph--view-mode--default sba-standard-margin-spacing"> <div class="usa-prose field__item" data-test="fieldItem"><p dir="ltr">When at least two small businesses could perform the work or provide the products being purchased, the government sets aside the contract exclusively for small businesses. With few exceptions, this happens automatically for all government contracts under $150,000.</p> <p dir="ltr">Some set-asides are open to any small business, but some are open only to small businesses who participate in SBA contracting assistance programs.</p> </div> </div> <div class="sba-section-headings"> <h3 class="sba-section-headings" id="sole-source-set-aside-contracts"> Sole-source set-aside contracts</h3> </div> <div class="paragraph paragraph--type--text-section paragraph--view-mode--default sba-standard-margin-spacing"> <div class="usa-prose field__item" data-test="fieldItem"><p dir="ltr">Most contracts are competitive, but sometimes there are exceptions to this rule. Sole-source contracts are a kind of contract that can be issued without a competitive bidding process. This usually happens in situations where only a single business can fulfill the requirements of a contract.</p> <p dir="ltr">To be considered for a sole-source contract, register your business with the <a href="https://www.sam.gov/">System for Award Management (SAM)</a> and participate in any <a href="http://www.sba.gov/federal-contracting/contracting-assistance-programs">contracting program</a> you may qualify for.</p> <p dir="ltr">In some cases, sole-source contracts must be published publicly, and will be marked with an intent to sole source. Potential vendors can still view and bid on these contracts. Once the bidding process begins, the intent to sole-source may be withdrawn.</p> </div> </div> <div class="sba-section-headings"> <h2 class="sba-section-headings" id="set-asides-for-government-contracting-programs"> Set-asides for government contracting programs</h2> </div> <div class="paragraph paragraph--type--text-section paragraph--view-mode--default sba-standard-margin-spacing"> <div class="usa-prose field__item" data-test="fieldItem"><p dir="ltr">Some set-asides are for small businesses in certain socio-economic categories. You can bid on these set-aside contracts by participating in the following SBA contracting assistance programs:</p> <ul> <li> <p dir="ltr"><a href="/federal-contracting/contracting-assistance-programs/8a-business-development-program" data-entity-type="node" data-entity-uuid="bb2bff60-5db9-4a20-9191-c69f855111f4" data-entity-substitution="canonical" title="8(a) Business Development program">8(a) Business Development program</a></p> </li> <li> <p dir="ltr"><a href="/federal-contracting/contracting-assistance-programs/hubzone-program" data-entity-type="node" data-entity-uuid="19e080f6-702f-4491-8934-e204db3efc41" data-entity-substitution="canonical" title="HUBZone program">HUBZone program</a></p> </li> <li> <p dir="ltr"><a href="https://www.sba.gov/federal-contracting/contracting-assistance-programs/women-owned-small-business-federal-contract-program">Women-Owned Small Business Federal Contract program</a></p> </li> <li> <p dir="ltr"><a href="https://www.sba.gov/federal-contracting/contracting-assistance-programs/veteran-contracting-assistance-programs#id-service-disabled-veteran-owned-small-business-program">Service-Disabled Veteran-Owned Small Business program</a></p> </li> </ul> <p dir="ltr">Participating in one of these SBA programs means you’ll have fewer businesses to compete with to win a government contract. However, you must meet eligibility requirements and certify your business’ socio-economic status before you can bid on a set-aside contract.</p> </div> </div> <div class="sba-section-headings"> <h3 class="sba-section-headings" id="how-to-certify"> How to certify</h3> </div> <div class="paragraph paragraph--type--text-section paragraph--view-mode--default sba-standard-margin-spacing"> <div class="usa-prose field__item" data-test="fieldItem"><p dir="ltr">The certification process may vary depending on the SBA contracting program. For some, you can self-certify just by updating your business profile in the <a href="https://www.sam.gov">System for Award Management</a> (SAM).</p> <p dir="ltr">For other programs, you have to apply for certification. As part of the application, you’ll answer questions about your business and its ownership, and upload supporting documents.</p> <p dir="ltr">Check each <a href="http://www.sba.gov/federal-contracting/contracting-assistance-programs">contracting program’s page</a> for specific details about eligibility requirements and the certification process.</p> </div> </div> <div class="sba-section-headings"> <h2 class="sba-section-headings" id="joint-ventures"> Joint ventures</h2> </div> <div class="paragraph paragraph--type--text-section paragraph--view-mode--default sba-standard-margin-spacing"> <div class="usa-prose field__item" data-test="fieldItem"><p>Two or more small businesses may pool their efforts by forming a joint venture to compete for a contract award. A joint venture of multiple small businesses still qualifies for small business set-aside contracts if its documentation meets SBA requirements.</p> <p>Small businesses that have a mentor-protege relationship through the <a href="/federal-contracting/contracting-assistance-programs/sba-mentor-protege-program" data-entity-type="node" data-entity-uuid="b15ed3b9-0373-41e2-9e75-f660cd383222" data-entity-substitution="canonical" title="SBA Mentor-Protégé program">SBA Mentor-Protégé program</a> can form a joint venture with a mentor (which can be a large business). These joint ventures can compete together for government contracts reserved for small businesses.</p> <p>A joint venture can also bid on contracts that are set aside for <a href="/federal-contracting/contracting-assistance-programs/veteran-contracting-assistance-programs" data-entity-type="node" data-entity-uuid="12b6da90-bfc2-4a68-9ddd-11e8cf0de9a2" data-entity-substitution="canonical" title="Veteran contracting assistance programs">service-disabled veteran-owned</a>, <a href="http://www.sba.gov/federal-contracting/contracting-assistance-programs/women-owned-small-business-federal-contracting-program">women-owned</a>, or <a href="http://www.sba.gov/federal-contracting/contracting-assistance-programs/hubzone-program">HUBZone</a> businesses, if a member of the joint venture meets SBA requirements to do so.</p> </div> </div> <div class="sba-section-headings"> <h3 class="sba-section-headings" id="need-help"> Need help?</h3> </div> <div class="paragraph paragraph--type--text-section 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