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What is a Small Business

Small Business – What is Small?


Many government contracts are reserved for small business owners.  These set aside criteria are typically defined in the bid.  When reviewing these bids it is very important to see if the bid defines the criteria for what qualifies as a “Small Business.”   Typically, the U.S. Small Business Administration (SBA) definition under Title 13, Code of Federal Regulations, part 121 (13 CFR 121) is referenced but this is not always the case.  Even within the federal government different agencies may have different criteria depending upon the statue being referenced.  National Public Radio released a published article titled, “When it comes to Businesses, How Big is Small?” (Click here to visit Article).  The article does a good job of explaining that the number of employees may not be the only qualification for a small business, additional criteria such as company’s revenue or value of your company’s assets may also be considerations depending on the industry.


Many states will also have their own criteria for qualifying as a small business. State purchasing agencies or Small Business Development Companies (SBDCs) are good resources for local qualifications of a “Small Business”.  Be careful to check the referenced criteria in a bid to make sure you can prove you meet the qualifications required.


The U.S. Small Business Administration has prepared a table which lists size standard matched to various industries described in the North American Industry Classification System (NAISC Codes). This table is available in an excel format or an adobe (.pdf) file.


The website for this table is –


Additional resources can be found at:


By: Chris Lynch