Should You Become a Federal Contractor as a Veteran?

By Allison Philips
Senior Copywriter and Edge Contributor

Civilian life offers myriad challenges for veterans navigating the transition back to private citizen. If you are a veteran entrepreneur and are exploring potential avenues for growth, consider becoming a federal contractor to the U.S. government.

How to Become a Federal Contractor

The U.S. government is the world’s largest customer. It buys all types of products and services and is required by law to provide opportunities for small businesses.

Federal contractors fall into two broad categories. Prime contractors bid on and win contracts directly from government agencies. Subcontractors join prime contractor teams, usually to provide a specific service or product.

Verification for Veteran-Owned Small Businesses

If you are a veteran and own a small business, consider putting yourself in the running for set-aside contracts at the Department of Veterans Affairs (VA). The VA has the Veterans First Contracting program.

Formal verification is required to become eligible for this program. You must formally verify your business as a Veteran-Owned Small Business (VOSB) or Service-Disabled Veteran-Owned Small Business (SDVOSB) to be eligible. VA’s Center for Verification and Evaluation (CVE) provides VOSB verification.

Service-Disabled Veteran-Owned Small Business Program

Service-Disabled Veteran-Owned Small Businesses are awarded at least 3% of federal contracting dollars annually. Once you join the program and become eligible, you can compete for set-aside contracts. You will also be able to compete for contracts in other qualifying socioeconomic programs for women, minorities, and disadvantaged groups or businesses located in underutilized areas.

You will require formal verification to become eligible for this program. To become part of the disabled veterans’ business program, there are certain eligibility requirements that must be met:

Your business needs to qualify as a small business according to SBA’s size standards.
Your business needs to be at least 51% owned and controlled by one or more service-disabled veterans.
Your business needs to have one or more service-disabled veterans managing daily operations and making long-term decisions.
Eligible veterans need to possess a service-connected disability.

Office of Veterans Business Development (OVBD)

Designed to promote entrepreneurship among veterans, the OVBD expedites Small Business Administration (SBA) program usage by veterans, service-disabled veterans, reservists, transitioning servicemembers, and their dependents or survivors. You will gain access to capital and prepare for various opportunities. Also, you will be connected with federal procurement and commercial supply chains.

Part of OVBD, the Veterans Business Outreach Center Program administers Veterans Business Outreach Centers (VBOCs) in the U.S. Veterans can explore how to become a federal contractor by taking advantage of workshops on business plans, concept assessments, mentorship and training.

Veteran-Owned Small Business Funding

SBA tools such as Lender Match can connect you with lenders. The SBA also offers the Military Reservist Economic Injury Disaster Loan Program (MREIDL), which discharges loans up to $2 million to cover unmet operating costs if an essential employee goes on active duty in the Reserves or National Guard.

Veteran Entrepreneurship Training Programs

Service-Disabled Veteran Entrepreneurship Training Program (SDVETP) offers training to service-disabled veteran entrepreneurs who wish to become small business owners or already own a small business. SBA funds training through the following grantees:

IVMF – Entrepreneurship Bootcamp for Veterans with Disabilities
Veterans Entrepreneurship Program – Riata Center for Entrepreneurship, Spears School of Business at Oklahoma State University
Entrepreneurship Bootcamp for Veterans – St. Joseph’s University
Dog Tag Inc.

The Veteran Federal Procurement Entrepreneurship Training Program (VFPETP) offers training to veteran-owned and service-disabled veteran-owned businesses who wish to pursue or are already involved in federal procurement. More information about federal procurement is available at The Veteran Institute for Procurement website.

Business Registration and ID Numbers

Becoming a government contractor means you will have to register your business and obtain the proper IDs. For instance, a Dun & Bradstreet Number (DUN) ― a nine-digit identification number ― is required to bid on proposals.

The North American Industry Classification System (NAICS) code categorizes businesses according to their products or services. You can locate your NAICS code on the code list at the U.S. Census Bureau.

Size Standards for Federal Contractors

Your business is required to meet the size that the Small Business Administration (SBA) mandates to qualify as a small business for specific contracts. NAICS codes are assigned size standards by the SBA.

Registering in SAM, the Government Agency’s Database

Government agencies utilize a database called the System for Award Management (SAM) to search for contractors. Registering your business in SAM is a part of becoming a federal contractor, so you’ll need to create a small business profile that functions much as a traditional resume would.

Maintaining Compliance

As a small business owner operating as a federal contractor, you are required to comply with all laws and regulations. Be sure to review the government’s purchasing process through the Federal Acquisition Regulation System and the small business regulations in 13 Code of Federal Regulations (CFR) 125.

Cybersecurity Requirements

If you are interested in Department of Defense (DoD) contracts, you must display the capability to protect their computer systems and data. A Cybersecurity Maturity Model Certification (CMMC) level is necessary for all bids.

DoD’s Project Spectrum offers tools and trainings to assist you with meeting the CMMC standard. Project Spectrum is free and is designed to help you with CMMC certification, cybersecurity awareness, and risk management.

How to Win Federal Contracts

You can explore federal contract opportunities at SAM.gov. Contracts over the amount of $25,000 must be listed in SAM by government agencies.

GSA Schedules

Obtaining a contract with the General Services Administration (GSA) is a good approach to start selling your products or services to the government. GSA is a federal agency responsible for connecting government buyers with contractors.

Subcontracting Prospects

If you are interested in being a subcontractor, there are many ways to do so. The SubNet database offers options from large contractors. Also, take the time to explore the SBA’s directory of prime contractors with subcontracting plans.

The GSA’s subcontracting directory is also a great resource for small businesses. The Department of Defense offers a similar directory of large prime contractors.

How to Get Additional Help

If you need more information or have questions, contact the Office of Government Contracting & Business Development.

409 3rd St. S.W., Suite 8000
Washington, DC 20416
Phone: 202-205-6459
Fax: 202-205-5206

As a veteran, becoming a federal contractor is worth investigating. It can provide you with potential opportunities to build or expand your business well into the future.