Entering Federal Contracting in 2025? Here’s the No-BS Guide Small Businesses Actually Need
If you’ve been thinking about getting into federal contracting, now’s a smart time to move. With over $178 billion awarded to small businesses in FY2023 and FY2025 shaping up to be just as lucrative—there’s opportunity out there. But winning contracts isn’t about luck or spammy bid sites—it’s about preparation, positioning, and persistence.
Let’s walk through what it really takes for an established small business to break into the federal contracting space—and avoid the common landmines.
The federal government buys everything. From catering and construction to cybersecurity and counseling. And federal agencies want to work with small businesses. By law, 23% of all federal contracting dollars are supposed to go to small firms. Some contracts are even reserved only for certain types of small businesses—like those with SBA 8(a) certification, women owned small business certification, or disabled veteran small business certification.
There are three main contract types to know:
Set-asides: Contracts only small businesses can bid on.
Sole-source: Direct awards without competition in some programs (like 8a contracts services or disabled veteran government contracts).
Open competition: Everyone can bid—but smalls may get evaluation preferences or subcontracting carve-outs.
Your small business certification status can open major doors here. But none of it matters if you’re not registered and visible.
Start with the Basics: Registration and NAICS
To even think about bidding, you need to register in SAM.gov—the government’s vendor database. That’s where you’ll get your Unique Entity ID (UEI), your CAGE code, and officially declare your size and status. Fill it out like a résumé for your business. Think about keywords buyers might search: your skills, tools, industries.
Next, figure out your contractor NAICS code. Or more likely, codes (plural). The best NAICS codes for small business are those that match both your services and the codes the government buys under. You can use the SBA’s size standards tool to confirm you qualify as small for each code.
Tip: Be thorough. If you do IT services, training, and consulting—list NAICS codes for all three. Many small businesses lose out simply because they weren’t findable under the right codes.
Certifications: Your Competitive Edge
Don’t stop at “small.” Most agencies have specific goals for certified businesses. Here are a few worth considering:
SBA 8a certification: For socially and economically disadvantaged business owners. Offers access to sole-source contracts and a 9-year business development program. 8a certification assistance is available via SBA and APEX Accelerators.
Women owned small business certification (WOSB/EDWOSB): Required for women-focused set-asides. Must be SBA certified—self-certifying in SAM is no longer enough.
Service-disabled veteran certification: SBA’s VetCert system verifies SDVOSB and VOSB firms, which opens doors with VA and other agencies.
HUBZone certification: For businesses in distressed areas with qualifying employees. Includes a 10% price preference and its own set-asides.
Getting certified can take weeks to months—so start before you see the perfect opportunity.
Set Yourself Up to Win
Here’s what separates the winners from the lurkers:
Build a strong capability statement (like a one-page résumé for your business).
Create a professional website with a clear “Government” page. List your NAICS, certifications, past clients, and contact info.
Update your Dynamic Small Business Search (DSBS) profile. Contracting officers use it to find vendors. Most firms never touch it after SAM auto-creates it—don’t be that firm.
Start making agency connections now—especially with small business offices (OSDBUs). Relationships still matter, even in a rules-driven world.
Where to Find Opportunities
Most small businesses live and die by SAM.gov. But that’s just the start:
SAM.gov: Use advanced search. Save your filters. Check “Sources Sought” and “Special Notices.”
Agency forecasts: Found on OSDBU or procurement pages. These tell you what’s coming months ahead.
SubNet: Prime contractors post subcontracting opportunities here.
USAspending.gov: See which agencies award contracts in your NAICS code. Dig into competitor wins.
This is where having the right contractor NAICS code and certifications pays off—agencies search by both.
Avoid the Rookie Mistakes
Let’s be real—most small businesses fail in federal contracting not because their service stinks, but because they:
Wait too long to register or certify.
Chase contracts way beyond their capacity (pro tip: start with subcontracting).
Ignore compliance (looking at you, cybersecurity).
Don’t follow up or build real relationships.
Submit sloppy, non-compliant proposals.
Don’t be like most. Do it right the first time.
Your Next Moves
If you’re serious about federal contracting, do these three things this week:
Register in SAM.gov if you haven’t already.
Identify your NAICS codes and check your SBA size status.
Start your WOSB, 8a, HUBZone, or SDVOSB application if eligible.
And if you’re already registered? Review your SAM profile. Clean up your DSBS listing. Download your target agency’s procurement forecast. Then send a tailored intro email to their small business office.
It’s a long game—but with focus and persistence, it pays.
Want more real-world tips for small business contractors? Check out “The Email You Should Be Sending Every Week to Contracting Officers (But Probably Aren’t)” for an outreach strategy that builds pipeline without being annoying.
If you aren't a Squared Compass partner, what are you waiting for? From getting your business set up with specific government set aside programs at both the State and Federal level, to being empowered by a Fractional Capture team to win government contracts, to receiving tailored government contract opportunities Squared Compass delivers immense value which helps propel our partners to success. Schedule a chat with our team today.
