Hubzone Certification Faqs
The Historically Underutilized Business Zone (Hubzone) program helps small businesses in urban and rural communities gain preferential access to federal procurement opportunities.
These preferences go to small businesses that obtain Hubzone certification in part by employing staff (at least 35%) who live in a Hubzone. The company must also maintain a “principal office” in one of these specially designated areas.
The federal government tries to award at least three percent of all federal prime contracting dollars to historically underutilized business zones (Hubzone) certified businesses each year. Firms that are Hubzone certified by the SBA are eligible for the following Federal procurement preferences:
- Application of a 10 percent price evaluation preference in full and open competition, for requirements above the simplified acquisition threshold. In such cases, the price offered by a Hubzone firm will be deemed lower than the price offered by the lowest, responsive large business offeror, as long as the Hubzone firm’s price is not more than 10 percent higher than the price offered by that offeror.
- Award of contracts set-aside for competition among Hubzone certified firms.
- Negotiation of sole source contracts if the contracting officer determines that: only one Hubzone certified firm can satisfy the requirement; the anticipated award price of the contract is not more than $5.5 million for manufacturing requirements, and not more than $3.5 million for all other requirements; the vendor is responsible with respect to performance; and the award can be made at a fair and reasonable price.
- While there is no specific goal for award of subcontracts to Hubzone certified firms, construction contracts exceeding $1 million, and all other prime contracts exceeding $550,000, must include, to the extent practicable, subcontracting plans that provide opportunities for Hubzone certified firms.
Hubzone certified businesses can also compete for contract awards under other socio-economic programs they qualify for.
A search of beta.sam.gov (Small Business Goaling Report) found that between 10/1/2019 to 9/30/2020 there were 90.936 contract actions totaling $10.4 Billion awarded in the Hubzone program.
If you would like a Hubzone Program eligibility analysis, please take our online hubzone eligibility questionnaire.
You are also welcome to review the basic eligibility requirements below. Generally, to be approved into the Hubzone Program you must meet these basic eligibility requirements:
Eligibility Criteria 1:
Your business concern’s principal office must be located in a qualified SBA designated Hubzone. Search the SBA’s Mapping system and verify if your principal office is located in a qualified SBA designated Hubzone.
- Definition of Principal Office means the location where the greatest number of the business concern’s employees at any one location perform their work.
(1) If an employee works at multiple locations, then the employee will be deemed to work at the location where the employee spends more than 50% of his or her time. If an employee does not spend more than 50% of his or her time at any one location and at least one of those locations is a non-Hubzone location, then the employee will be deemed to work at a non-Hubzone location.
(2) In order for a location to be considered the principal office, the concern must conduct business at this location.
(3) For those concerns whose “primary industry classification” is services or construction, the determination of principal office excludes the concern’s employees who perform more than 50% of their work at job-site locations to fulfill specific contract obligations. If all of a concern’s employees perform more than 50% of their work at job sites, the concern does not comply with the principal office requirement.
(i) Example 1: A business concern whose primary industry is construction has a total of 78 employees, including the owners. The business concern has one office (Office A), which is located in a Hubzone, with 3 employees working at that location. The business concern also has a job-site for a current contract, where 75 employees perform more than 50% of their work. The 75 job-site employees are excluded for purposes of determining principal office. Since the remaining 3 employees all work at Office A, Office A is the concern’s principal office. Since Office A is in a Hubzone, the business concern complies with the principal office requirement.
(ii) Example 2: A business concern whose primary industry is services has a total of 4 employees, including the owner. The business concern has one office located in a Hubzone (Office A), where 2 employees perform more than 50% of their work, and a second office not located in a Hubzone (Office B), where 2 employees perform more than 50% of their work. Since there is not one location where the greatest number of the concern’s employees at any one location perform their work, the business concern would not have a principal office in a Hubzone.
(iii) Example 3: A business concern whose primary industry is services has a total of 6 employees, including the owner. Five of the employees perform all of their work at job-sites fulfilling specific contract obligations. The business concern’s owner performs 45% of her work at job-sites, and 55% of her work at an office located in a Hubzone (Office A) conducting tasks such as writing proposals, generating payroll, and responding to emails. Office A would be considered the principal office of the concern since it is the only location where any employees of the concern work that is not a job site and the 1 individual working there spends more than 50% of her time at Office A. Since Office A is located in a Hubzone, the small business concern would meet the principal office requirement.
Eligibility Criteria 2:
Your business concern must be at least 51% owned and controlled by persons who are US citizens.
Definition of Ownership means:
- (1) At least 51% owned and controlled by one or more individuals who are United States citizens;
- (2) An ANC or at least 51% owned by an ANC or a wholly-owned business entity of an ANC;
- (3) At least 51% owned by one or more Indian Tribal Governments, or by a corporation that is wholly owned by one or more Indian Tribal Governments;
- (4) At least 51% owned by one or more CDCs;
- (5) A small agricultural cooperative organized or incorporated in the United States, or at least 51% owned by one or more small agricultural cooperatives organized or incorporated in the United States; or
- (6) At least 51% owned by one or more NHOs, or by a corporation that is wholly owned by one or more NHOs.
Definition of Control means both the day-to-day management and long-term decision-making authority for the Hubzone business. Many persons may share control of a concern, including each of those occupying the following positions: officer, director, general partner, managing partner, managing member and manager. In addition, key employees who possess expertise or responsibilities related to the concern’s primary economic activity may share significant control of the concern. SBA will consider the control potential of such key employees on a case by case basis.
Eligibility Criteria 3:
35% of your business concern’s employees must reside in an SBA designated Hubzone. When determining the percentage of employees that reside in a Hubzone, if the percentage results in a fraction, SBA rounds to the nearest whole number.
- Definition of Employee means all individuals employed on a full-time, part-time, or other basis, so long as that individual works a minimum of 40 hours during the four-week period immediately prior to the relevant date of review, which is either the date the concern submits its Hubzone application to SBA or the date of re-certification.SBA will review a concern’s payroll records for the most recently completed pay periods that account for the four-week period immediately prior to the date of application or date of re-certification in order to determine which individuals meet this definition. To determine if an individual is an employee, SBA reviews the totality of circumstances, including criteria used by the Internal Revenue Service (IRS) for Federal income tax purposes and the factors set forth in SBA’s Size Policy Statement No. 1 (51 FR 6099, February 20, 1986).
In general, the following are considered employees:
- (i) Individuals obtained from a temporary employee agency, leasing concern, or through a union agreement, or co-employed pursuant to a professional employer organization agreement;
- (ii) An individual who has an ownership interest in the concern and who works for the concern a minimum of 40 hours during the four-week period immediately prior to the relevant date of review, whether or not the individual receives compensation;
- (iii) The sole owner of a concern who works less than 40 hours during the four-week period immediately prior to the relevant date of review, but who has not hired another individual to direct the actions of the concern’s employees;
- (iv) Individuals who receive in-kind compensation commensurate with work performed. Such compensation must provide a demonstrable financial value to the individual and must be compliant with all relevant federal and state laws.
In general, the following are not considered employees:
- (i) Individuals who are not owners and receive no compensation (including no in-kind compensation) for work performed;
- (ii) Individuals who receive deferred compensation for work performed;
- (iii) Independent contractors that receive payment via IRS Form 1099 and are not considered employees under SBA’s Size Policy Statement No. 1; and
- (iv) Subcontractors.
Employees of an affiliate may be considered employees, if the totality of the circumstances shows that there is no clear line of fracture between the Hubzone applicant (or certified Hubzone small business concern) and its affiliate(s) (see §126.204).
- Example 1: A concern has 25 employees; 35% of 25, or 8.75, employees must reside in a Hubzone. The number 8.75 rounded to the nearest whole number is 9. Thus, 9 employees must reside in a Hubzone.
- Example 2: A concern has 95 employees; 35% of 95, or 33.25, employees must reside in a Hubzone. The number 33.25 rounded to the nearest whole number is 33. Thus, 33 employees must reside in a Hubzone.
Definition of Reside means to live at a location full-time and for at least 180 days immediately prior to the date of application (or date of re-certification where the individual is being treated as a Hubzone resident for the first time). An employee who resides in a Hubzone at the time of certification (or time of recertification where the individual is being treated as a Hubzone resident for the first time) shall continue to count as a Hubzone resident employee if the individual continues to live in the Hubzone for at least 180 days immediately after certification (or recertification) and remains an employee of the concern, even if the employee subsequently moves to a location that is not in a Hubzone or the area in which the employee’s residence is located no longer qualifies as a Hubzone. The certified Hubzone small business concern must maintain records of the employee’s original Hubzone address, as well as records of the individual’s continued and uninterrupted employment by the Hubzone small business concern, for the duration of the concern’s participation in the Hubzone program.
Example: As part of its application for Hubzone certification, a concern provides documentation showing that 35% of its employees have lived in a Hubzone for more than 180 days. SBA certifies the concern as a certified Hubzone small business concern. Within 180 after being certified, an individual critical to the concern’s meeting the 35% residency requirement moves out of the Hubzone area. That individual will continue to be treated as a Hubzone resident during the first year after the concern’s certification; however, at the time of the firm’s recertification, that individual will not be counted as a resident of a Hubzone.
(1) To determine residence, SBA will first look to an individual’s address identified on his or her driver’s license or voter’s registration card. Where such documentation is not available, SBA will require other specific proof of residency, such as deeds, leases, or utility bills. Where the documentation provided does not demonstrate 180 days of residency, SBA will require a signed statement attesting to an individual’s dates of residency.
(2) For Hubzone purposes, SBA will consider individuals temporarily residing overseas in connection with the performance of a contract to reside at their U.S. residence.
- (i) Example 1: A person possesses the deed to a residential property and pays utilities and property taxes for that property. However, the person does not live at this property, but instead rents out this property to another individual. For Hubzone purposes, the person does not reside at the address listed on the deed.
- (ii) Example 2: A person moves into an apartment under a month-to-month lease and lives in that apartment full-time. SBA would consider the person to reside at the address listed on the lease if the person can show that he or she has lived at that address for at least 180 days immediately prior to the date of application or date of re-certification.
- (iii) Example 3: A person is working overseas on a contract for the small business and is therefore temporarily living abroad. The employee can provide documents showing he is paying rent for an apartment located in a Hubzone. That person is deemed to reside in a Hubzone.
Eligibility Criteria 4:
Your business concern must be classified as a small business as defined by the SBA.
- Definition of Small Business means the business concern, with its affiliates, must meet the size standard corresponding to its primary industry classification.
Eligibility Criteria 5:
A concern must certify that it will attempt to maintain having at least 35% of its employees reside in a Hubzone during the performance of any Hubzone contract it receives, meets the Subcontracting requirements and not be suspended or debarred.
Attempt to Maintain means making substantive and documented efforts, such as written offers of employment, published advertisements seeking employees, and attendance at job fairs and applies only to concerns during the performance of any Hubzone contract. A certified Hubzone small business concern that has less than 20% of its total employees residing in a Hubzone during the performance of a Hubzone contract has failed to attempt to maintain the Hubzone residency requirement.
Subcontracting. At the time of application, an applicant concern must certify that it will comply with the applicable limitations on subcontracting requirements in connection with any procurement that it receives as a certified Hubzone small business concern (see §§126.5 and 126.700).
Suspension and Debarment. In order to be eligible for Hubzone certification and to remain certified, the concern and any of its owners must not have an active exclusion in the System for Award Management, available at www.sam.gov, at the time of application.
Keep in mind that each Hubzone Application is unique and document requirements vary for each Hubzone Application.
Below is a general list of items that will need to be included within your Hubzone application. Your unique application may require additional items not specified below.
IMPORTANT NOTE: The electronic verification date for your firm’s HUBZone application is the date on which the applicant authorizes the electronic HUBZone Application for processing by the SBA. The verification notice will be sent to the firm via electronic communication by the SBA after completing the HUBZone electronic Application. This date is extremely important to note.
Documents demonstrating your firm meets Ownership & Control and Size requirements:
Corporate documents: Although your firm may not be required to submit all of the following documentation to the Secretary of State, in your state, it is nonetheless required and necessary to determine the eligibility criteria for the SBA HUBZone Program. Failure to provide these documents will result in your application being withdrawn or declined by the SBA.
The following documents must be provided, each of which must be valid at the time of electronic verification and have all required signatures:
If your firm is a Corporation:
- DBA (Doing Business As) Certificate, if applicable.
- Articles of Incorporation and any amendments (Only submitting the Secretary of State (SOS) seal certificate is not acceptable. You must also submit a copy of the firm’s Articles of Incorporation along with the SOS seal certificate.)
- Corporate Bylaws and any amendments.
- Executed Stock Certificates (front & back).
- Stock Ledger or Register (This ledger or register should summarize all stock actions taken from issuance through transfer and or cancellation.
If your firm is a Limited Liability Company (LLC):
- DBA (Doing Business As) Certificate, if applicable.
- Articles of Organization and any amendments (Only submitting the Secretary of State (SOS) seal certificate is not acceptable. You must also submit a copy of the firm’s Articles of Organization along with the certificate with the SOS seal certificate.)
- Operating Agreement and any amendments.
If your firm is a Sole Proprietor:
- DBA (Doing Business As) Certificate, if applicable.
If your firm is a Partnership:
- DBA (Doing Business As) Certificate, if applicable.
- Partnership Agreement and any amendments.
Documents demonstrating Firm Ownership, any Affiliation and Citizenship:
- Proof of US Citizenship for owners. One of the following:
- Birth certificate
- Current valid U.S. Passport
- Certificate of Naturalization.
- Other key ownership related documents:
If your firm is a member of a franchise you will need to provide a copy of the franchise agreement. If your firm is owned in part by an ESOP or Trust you will need to provide a copy of the ESOP plan or Trust Agreement.
Documents demonstrating your firm meets the Hubzone employment and principal office requirements:
- Firm location list that lists all locations maintained by your firm or used as job sites to include:
- Complete address for all office locations and each applicable job site location(s).
- Specification of which of the following 3 location types it is:
- Principal Office: Location maintained by your firm (i.e., owned or leased by your firm) where the greatest number of your firm’s employees at any one location perform their work.
- Other firm location(s): Location(s) maintained by your firm which are NOT the Principal Office.
- Job site: Firms whose “primary industry” is service or construction should classify as job sites all locations used to fulfill specific contract obligations.
- A listing of all employees working at the Principal Office.
- The number of hours that each employee performs their work at the Principal Office location that include the days of week and business hours each office is staffed.
- The number of hours that each employee performs their work at other office location(s) that include the days of week and business hours each office is staffed at other office location(s).
Please Note: If the firm only operates from the principal office location and there are no other locations or job sites, you must provide the requested information for the principal office location and indicate that there are no other locations and or job sites in writing.
- A Hubzone Map printout of your principal office location.
- Lease/rental agreement/deed for Principal Office: A copy of a fully executed lease/rental agreement or deed for the firm’s Principal Office location which is valid and in full effect at the time of electronic verification of your application. Your firm’s full legal name must be identified as being the lessee, renter, or owner. If your lease/rental agreement or deed only includes a parcel description, you must also provide a property tax bill and/or insurance policy supporting the physical address of the Principal Office location.
If you operate out of your primary residence, you must provide a copy of the deed for your primary residence, a copy of a utility bill that covers the period of time including the electronic verification of your application. Examples include gas, electric, water, sewer or landline telephone. Cellular phone bills are not acceptable. You must also provide a copy of the firms insurance policy too.
Note: A property tax bill and/or insurance policy is for verification of the physical address only. Submission of this document in lieu of the required lease or deed is not acceptable.
- Utility bill for Principal Office: You must provide a copy of a utility bill for the firm’s Principal Office that covers the period of time including the electronic verification of your application. Examples include gas, electric, water, sewer, internet or landline telephone. Cellular phone bills are not acceptable. If utilities are included with the rent and you cannot provide a land-line telephone bill, you must provide evidence that utilities are included within lease/rental agreement or signed affidavit from lessor indicating this is the case.
- Employee list: You must provide a complete listing of all who work for the firm at the time of electronic verification, including paid or unpaid owners, salaried or hourly-wage employees, and temporary workers. If an individual has an ownership interest in and works for the business a minimum of 40 hours per month, that owner is considered an employee regardless of whether or not the individual receives compensation. This listing must include for each individual:
- Full name
- Description of type of worker, e.g., salaried, included in payroll, owner, leased, obtained through PEO, obtained through union agreement, shared with affiliate, temporary, etc. Note: Some individuals may require multiple designations in the description, “owner, salaried, included in payroll.”
- Whether or not the individual resides in a Hubzone. This should be supported by the documents specified below regarding Hubzone maps and identification/proof of residence.
- Number of hours worked per month.
- Primary work location, e.g., Principal Office, other firm location, OR job site. If the individual works at more than one location, select the location where the individual spends the single greatest portion of their time. (As an example, if an employee works 16 hours per week at the “Principal Office,” 12 hours per week at an “other firm location,” and 12 hours per week at a “job site,” specify the Principal Office as the primary work location).
- Working days of the week and hours of principal office.
- Contractor List (If Applicable):
The SBA may use the totality of circumstances to find that independent contractors are considered employees for the purpose of Hubzone certification.
For each independent contractor that worked at least 40 hours during the month preceding the time of review, provide the contractor’s full name and signed copies of executed contracts.
If signed copies of executed contracts are not available, provide:
- A detailed description of work performed by each independent contractor including the number of hours worked, the type of work performed, and where the work is performed.
- Copies of all invoices from each independent contractors, and proof of payment for invoices.
- Do any of the independent contractors have or have they had in the past, business cards issued by your firm? If yes, provide SBA with a copy of the business card.
- Do any of the independent contractors have email accounts issued to them by your firm? If so, provide SBA with individual’s email address.
- Payroll records: You must provide a copy of your firm’s official payroll record from a time period which covers the date of electronic verification and shows at a minimum the employee’s name, number of hours worked for that pay period, and wages with taxes and adjustments. (Salaried employees who do not have hours worked specified are assumed to work 40 hours per week.) This payroll record must clearly show the pay period’s beginning and end dates, not just the pay date. Do not submit a combined summary of all the pay periods. Each pay period will need to be provided on a separate payroll record.
Note: In order for the SBA to consider a person working for your firm to be an employee, we must have evidence from your payroll records that the person works at least 40 hours in a month’s time. All payroll records submitted must be for the time of electronic verification and PRIOR.
For example: If Payroll is paid on the 30th of the month and the application is submitted on January 2, 2019. The applicant firm must wait at minimum until the January 31, 2019 payroll is issued before the processing of the application may begin. In this example, you would be prohibited from using the December 31, 2019 payroll date because that date does not include the electronic verification date. For any employees working less than 40 hours in the payroll period which includes the date of electronic verification, you must also provide enough immediately previous payrolls to demonstrate that those employees work at least 40 hours in a month’s time. As an example, if you have a weekly payroll system and an employee who works 10 hours the week of electronic verification, you would need to provide the 3 previous weekly payrolls in order to demonstrate that the person works 40 hours per month for a total of 4 weekly payrolls. The latest of these 4 contiguous payroll periods should include the date of application submission.
- State and federal employment filings: You must provide complete copies of your firm’s most recently available state unemployment tax filing and the most recently available federal employment quarterly report (Form 941- Employer’s Quarterly Federal Tax Form). The state unemployment report must include the employee listing supporting the summary of wages.
If the firm has not filed any of the above reports, you must note as such in writing. Failure to provide a response to this request will cause a delay in the processing of the application.
- Hubzone maps of Hubzone residents’ addresses: Copies of the Hubzone Map to verify each Hubzone employees’ residence is in a Hubzone. In order to provide the Hubzone map for each employee, select the following link:
Once you enter the Hubzone mapping system enter the physical address for each Hubzone employee. Print the page using the Printable Version button on the right side of the screen. Print the page exactly as it is displayed including the personal address for each individual. Altering the Hubzone Map or not providing the entire printout will make the document invalid. Please write the employee’s name at the bottom of each map and provide a printed map for each employee and do not provide one locator for multiple employees.
- Identification/proof of residence for Hubzone residents: You must provided a copy of a valid (unexpired) Department of Motor Vehicles driver’s license, Department of Motor Vehicles Identification card, or voter’s registration card for each of the firm’s Hubzone resident employees. Do not send Social Security cards. The copy must be legible and show the employee’s full name and address. If the address listed is no longer valid or is a PO Box, you must also provide a copy of a current lease agreement, mortgage statement, utility bill (not cell phone), or change of address card in the name of the individual which shows the Hubzone address where the individual resides. Failure to provide sufficient proof of Hubzone residency for employees could lead to your firm being proposed for de-certification.
- Provided the appropriate HUBZone Program Certification Signature Sheet (based on your firm’s ownership structure)
This form must be signed by an officer of the firm authorized to represent the applicant, notarized, and mailed in hard copy. An email or faxed copy of the Program Certification Signature Sheet will NOT be accepted.
Please note that if all of the above supporting documentation being requested is not received within the allotted time frame, your application may be withdrawn or declined. Failure to submit information and documentation within the allotted time frame is a common cause of applications being withdrawn or declined. Please make note of your submission deadline.
Other Key Tips:
- You must have a current SAM.GOV, SBA DSBS (Dynamic Small Business Search) and Dun and Bradstreet (D&B) profile for your business. All profiles must match the address of principal office of the firm.
- You must identify your primary NAICS code within your SAM.GOV and DSBS Profile.
Just input the full street address, city, state and zip code of your business or your employees primary residence address into the SBA mapping system.
The system will automatically determine if any of these locations are located in a designated Hubzone tract.
Yes. A startup company can apply for Hubzone Certification and get certified as long as it meets all of the Hubzone eligibility requirements and can provide the required items needed by the SBA.
Yes. If you operate out of your primary residence, you must provide a copy of the deed or rental agreement for your primary residence and a copy of a utility bill that covers the period of time including the electronic verification of your application. Examples include gas, electric, water, sewer or landline telephone. Cellular phone bills are not acceptable. You must also provided a copy of the firms insurance policy too.
Note: A property tax bill and/or insurance policy is for verification of the physical address only. Submission of this document in lieu of the required lease or deed is not acceptable.
Yes. If an individual has an ownership interest in and works for the business a minimum of 40 hours per month, that owner is considered an employee regardless of whether or not the individual receives compensation.
Of course, you must also meet all of the other Hubzone eligibility requirements too.
You are required to have multiple SAM.GOV registrations for each office location where you have a lease or rental agreement.
Your principal office will be determined as the office where the greatest number of employees report to and work out of.
As stated in the basic eligibility requirements, job site’s or client sites are excluded.
The federal government is the largest buyer in the world, but how do you know what agency will buy what you sell?
What do government agencies buy and where to locate opportunities?
The federal government buys everything from office supplies to missiles. No matter what your product or services are, chances are there is a federal agency that buys it. But you can’t sell your products or services to the federal government if you don’t know which federal agencies are buying and what their needs are.
Here are some tips for finding Hubzone contract opportunities:
- The federal government operates an online service called beta.SAM.gov, which as of November 12, 2019, is now home to all current contract opportunities formerly posted to FBO.gov. This single entry, government wide Web site, https://beta.sam.gov announces available business opportunities and is a powerful tool to help you become successful in government contracting.
You can narrow down your search for Hubzone set-aside contract opportunities or set-up an account to automatically receive targeted opportunities via email. We suggest that you specifically look for Hubzone opportunities that are in the pre-solicitation or sources sought phase as most of the other phases are too far along in the procurement process already.
- Contact each federal agency’s OSDBU (Office of Small Disadvantaged Business Utilization) office. The OSDBU’s ensure that small and disadvantaged businesses are provided maximum practicable opportunity to participate in the agency’s contracting process. The primary responsibility of the OSDBU is to ensure that small businesses are treated fairly and have an opportunity to compete and be selected for a fair amount of the agency’s contracting and subcontracting dollars. Most OSDBU offices also offer the availability of looking at their procurement forecasts, as well as doing business with guides, organization charts with names and phone numbers for points of contact. Each web site should list the Small Business Specialist’s name and telephone number. Contact the Small Business Specialists at targeted installations to request pamphlets, guides, web sites, bidder’s list applications, etc. See below for a list of OSDBU offices by agency:
- Defense Contract Management Agency (DCMA)
- Defense Logistics Agency (DLA)
- Department of Agriculture
- Department of Army
- Department of Air Force
- Department of Navy
- Department of Commerce
- Department of Defense
- Department of Education
- Department of Energy
- Department of Health & Human Services
- Department of Homeland Security
- Department of Housing and Urban Development
- Department of Interior
- Department of Justice
- Department of Labor
- Department of State
- Department of Transportation
- Department of Treasury
- Department of Veterans Affairs
- Federal Aviation Administration
- General Services Administration
- National Guard
- National Science Foundation
- Office of Personnel Management
- Social Security Administration
- United States Marine Corps
- United States Coast Guard
- US Environmental Protection Agency
Agencies use a variety of means for purchasing items. Hubzone firms should become familiar with how those buying offices advertise these requirements and then monitor them closely. Most government agencies have common purchasing needs. The government can realize economies of scale by centralizing the purchasing of certain types of products or services.
- Visit the Federal Procurement Data System web site. It contains every federal procurement that has ever taken place. The web site can be found by visiting https://www.fpds.gov. You can search and find out which federal agency is buying your products or services, the names of your competitors who were awarded past contracts, their dollar value, location, NAICS code and more.
- Visit the USASpending.gov web site. USAspending.gov is the official source for spending data for the U.S. Government. Its mission is to show the American public what the federal government spends every year and how it spends the money. You can follow the money from the Congressional appropriations to the federal agencies and down to local communities and businesses.
Once you have an idea of who you can sell your products and services to, your local Procurement Technical Assistance Centers (PTACs) (http://www.aptac-us.org/) may offer workshops for small businesses to acquire a basic understanding of the federal government procurement process. Some locations also offer services such as matching a firm’s capabilities with federal solicitations advertised in FedBizOpps, information on subcontracting opportunities, one-to-one technical assistance in completing bid packages and other paperwork, etc.
When Will the Agency Buy It Again?
As stated above, most agencies publish procurement forecasts on their web sites. Procurement forecasts are wish lists of proposed contract opportunities that may or may not come to fruition. Procurement history may be more reliable. If they’ve been buying it for years, they may continue to buy it. You may want to try to identify knowledgeable officials at the buying agency and then ask for their opinions. But again, their information may be subject to change. Much of what an agency buys depends on their budget. You should also develop a good rapport with buying agency officials.
One of the most important things that you have to do next is to convince the buying agency that they should buy from you. If the buying agency is using a competitive procurement process, why should it consider using Hubzone procedures? You must show that your business is competent, capable and reasonably priced. Make it in the buying agency’s best interests to contract with you.
If the buying agency is currently using Hubzone procedures, why should it contract with you and not some other Hubzone firm? How will you provide better service, better quality or better prices? What is it that you can do to either solve the buying agency’s problems, or prevent problems from occurring, or provide insight into problem solving more than any other firm? Show them what you bring to the table.
Selling to the federal government is not that much different from selling to the private sector. It all comes down to marketing. Your Hubzone status is a marketing tool that allows you to get your foot in the door at buying agencies, but you must use the tool wisely. Unless you have an unlimited marketing budget and personnel, you will have to decide which and how many agencies to target. Realistically, an Hubzone company can effectively market only three, four, or at most, five agencies. Which agencies you decide to market will depend on the factors discussed above.
Once your electronic Hubzone Application is authorized for processing, the SBA provides up to 10 business days for the uploading of all supporting documents.
Your SBA reviewer, may at this time, request additional information to answer any questions they have. If you have us prepare your Hubzone Application we prepare all formal responses to the SBA as part of our Hubzone Application Completion Service.
Once the SBA has determined that your Hubzone Application is deemed complete, it will take approximately 90-120 days to be notified of a decision by the SBA.
A business that receives Hubzone Certification has a program term of three (3) years from the date of approval.
The business must maintain its Hubzone Program eligibility during its time in the program and must inform the SBA of any changes that would adversely affect is eligibility. The three (3) year term may be shortened by non-compliance or de-certification.
Hubzone businesses must notify the SBA if their business undergoes any material changes that would affect their Hubzone status. Some examples of material changes include:
- Change in ownership
- Change in business structure
- Change in principal office
- Falling below the 35% employee Hubzone residency requirement
The SBA may visit Hubzone businesses unannounced and conduct program examinations. The SBA does this to confirm that businesses continue to meet Hubzone requirements.
A business that completes it three (3) year term can renew its certification every three (3) years.
In order to get do business with the Federal Government your business must be registered within SAM.GOV.
Registration for a SAM.GOV profile is FREE. You do not need to hire anyone to obtain a SAM.GOV profile. There are some companies, out there, that are charging exorbitant fees ($500+) to do this for you. Stay away from them.
SAM.GOV offer a free guide on how to properly obtain a SAM.GOV profile.
Your primary NAICS (North American Industry Classification System) code is the six digit code that your business earned its largest segment of revenue in, in the most recently completed fiscal year. The primary NAICS code help the SBA determine what industry you are operating in and if you are classified as a small business.
Visit the US Census Bureau to help determine your primary NAICS code.