The Small Business Association's 8(a) Business Development Program is designed to help socially or economically disadvantaged small business owners bid for government contracts. Once a business has been designated socially and economically disadvantaged and is part of the 8(a) Business Development Program the owners are able to bid on projects that are exclusive to the program, which limits the amount of competition and helps level the playing field for those businesses.
SBA 8(a) Business Development Program FAQs:
How do I qualify for the 8(a) Business Development Program?
To qualify for the SBA's 8(a) Business Development Program you / your business must meet the following criteria:
- Be a small business (you can use the Small Business Association website's size standards tool to determine whether your business qualifies.
- You've not already participated in the 8(a) Business Development program.
- Your business is at least 51% owned and controlled by economically and socially disadvantaged United States citizens.
- Your small business's owner has a personal net worth of $250,000.00 or less.
- Your small business's owner's average adjusted gross income for the past three years is $250,000.00 or less.
- Your small business's owner has $4 million or less in assets.
- Your small business's owner manages both day-to-day operations and long-term plans.
- All your small business's principals demonstrate good character.
- You show potential for success and can successfully deliver on contracts.
What does "economically and socially disadvantaged" mean?
At its essence "economically and socially disadvantaged" indicates a person who has been discriminated against solely because of their race, ethnicity, gender, physical handicap, or location and whose business has suffered economically due to that discrimination. The SBA has a detailed list of designated groups that qualify as socially and economically disadvantaged; anyone not included in those groups has to prove they're disadvantaged by "a preponderance of the evidence."
The full text on the designation of "economically and socially disadvantaged" can be found here. The SBA helpfully provides a far more manageable Are You Qualified? tool that can help you avoid having to dig into and learn the stipulations, which are extensive.
What does the 8(a) Business Development program for disadvantaged SMBs do?
Quite a bit. The biggest advantage is that once you're a designated 8(a) small business you're able to compete for government contracts that have been specifically set aside for disadvantaged businesses. These contracts typically top out at $150,000.00, which can be a significant amount of money when you're trying to get a business off the ground.
There are also sole-source set-aside contracts that, if your business is best positioned to deliver on, you can land without competition. Learn more about set-aside and sole-source contracts at the SBA site.
Are there more benefits to the SBA's 8(a) Business Development program?
Absolutely. When you qualified you'll be paired with a Business Opportunity Specialist who can help you navigate the federal contracting system. In addition, you can pair with established businesses and experienced business mentors with the SBA's mentor-protégé program.
You'll also receive, as needed, business training, business counseling, marketing assistance, and high-level executive development training by Small Business Association experts.
Can you explain more about the SBA's mentor-protégé program?
The Small Business Association's mentor-protégé program pairs qualifying 8(a) small businesses with mentors who can help them meet the goals established in the SBA-approved business plan and become more competitive in landing contracts. Read the complete details of the program here.