Support Robust Small Business Federal Contracting

February 22, 2021


The complexity of applying for a government contract can discourage many small-business owners from competing in a government bid. Despite the federal government meeting its small-business contracting goals in recent years, more can and should be done to ensure fairness for small firms within the federal marketplace.

  • In recent years, while the federal government has generally succeeded in meeting the government-wide goals of awarding 23 percent of federal contracting dollars to small business, it has fallen short of the goals established for woman-owned small businesses and HUBZone small businesses.
  • While some in the federal bureaucracy have suggested raising the 23 percent—specifically, Treasury has outlined a goal of 35 percent overall small-business contracts—absent legislation, such goals and targets are relatively meaningless.
  • The bidding process for a federal contract can be hard and complicated, especially for small businesses new to the process, due to a long list of special forms, terms and conditions, and other requirements. Additional requirements, such as a Defense Contract Audit Agency-compliant accounting system can incur further costs on a small business looking to work with the federal government.


Small businesses are agile, innovative and affordable partners for the federal government, and the government in turn can be an important partner for small business. Through small business contracting, the federal government acts as a catalyst for small business growth and innovation and supports the national economic security of the nation. NSBA supports reasonable reforms and policies that will further promote and facilitate small-business participation in the federal marketplace.

  • Increase the small-business federal contracting and subcontracting goal.
  • Establish a consolidated, more streamlined registration process.
  • Eliminate fraud of awarding small-business federal contracts to large companies through prompt prosecution and increased SBA authority to disbar.
  • Strengthen and improve the quality and integrity of contracting data.
  • Terminate the practice of contract bundling.
  • Increase oversight authority for the Office of Management and Budget and raise the accountability for each agency’s respective Office of Small and Disadvantaged Business Utilization so they report directly to the Agency head.
  • Ensure appropriate treatment of subcontractors including: timely payment; addressing Miller Act waivers; and including the entire contract award when calculating the percentage of small-business subcontracts given out, not just those dollars that are subcontracted.
  • Reject efforts to minimize or eliminate small-business set-asides in federal contracting.