How to Start a Federal Contracting Business as a Veteran

The federal government awards more than $700 billion in contracts annually and is legally required to set aside a portion specifically for veteran-owned and service-disabled veteran-owned small businesses. This creates a real competitive advantage — but only for businesses that understand how to navigate the federal procurement system.

The Veteran Contracting Preference Landscape

By law (the National Defense Authorization Act and Small Business Act), the federal government has annual goals for veteran business contracting:

• 3% of all prime contracting dollars to Service-Disabled Veteran-Owned Small Businesses (SDVOSB)
• Veteran-owned small businesses have additional preferences in the broader pool

Contracting officers can award SDVOSB set-aside contracts with limited competition — only from certified SDVOSBs — when at least two qualifying firms can perform the work. This dramatically reduces competition compared to open market contracts.

Starting Point: What You Need Before You Bid

Step 1 — Determine your NAICS codes. Every contract is assigned a North American Industry Classification System (NAICS) code describing what the work involves. You need to know which codes align with your business's work, because:

• Size standards are NAICS-code specific
• Contract opportunities are searchable by NAICS code
• Your capabilities statement should reflect your target NAICS codes

Step 2 — Register in SAM.gov. The System for Award Management (SAM.gov) is the federal contractor database. You must be registered and current in SAM to receive federal contracts. Registration requires:

• Your business's DUNS number (replaced by UEI — Unique Entity Identifier — in 2022)
• EIN (Employer Identification Number)
• Business bank account
• NAICS codes for your work

SAM registration is free but requires renewal annually.

Step 3 — Get VetCert certified. For SDVOSB and VOSB set-aside preferences, you must be certified through the SBA's VetCert program. See our VetCert guide for the full process.

Step 4 — Register on additional agency portals. Many agencies have their own vendor portals in addition to SAM. DoD uses multiple contract management systems. Agencies publish opportunities on beta.sam.gov (now sam.gov). Register early and explore the opportunity landscape before you're ready to bid.

Finding Contract Opportunities

SAM.gov: The primary federal opportunity portal. Search by NAICS code, keyword, agency, and set-aside type (look for "SDVOSB Set-Aside" or "VOSB Set-Aside" in the filter). Free and comprehensive.

Subcontracting: Many new federal contractors start as subcontractors under larger prime contractors, not as prime contractors themselves. Prime contractors on large contracts are often required to give subcontracting opportunities to small and veteran-owned businesses. Contact large prime contractors in your industry directly.

GSA Schedule (MAS Contract): A General Services Administration Multiple Award Schedule contract allows agencies to buy from your company at pre-negotiated rates without a full competitive solicitation for each purchase. Getting a GSA Schedule takes 6–12 months but creates a durable sales channel. GSA Schedule solicitations are at gsa.gov.

Writing a Capabilities Statement

Every federal contractor needs a capabilities statement — a one or two-page document that tells contracting officers what you do, for whom you've done it, and why you're qualified. A strong capabilities statement includes:

• Core competencies (specific services with NAICS codes)
• Differentiators (what makes your firm distinct)
• Past performance (relevant contracts completed successfully)
• Company data (SAM UEI, NAICS codes, cage code, certifications including VetCert)
• Contact information

Realistic Timeline

Federal contracting is not fast. From business registration to first award, many veteran contractors report timelines of 12–24 months, including:

• SAM registration: 2–4 weeks
• VetCert certification: 60 days
• GSA Schedule (if pursuing): 6–12 months
• Finding and winning a first contract: 3–18 months after certifications complete

Starting while still on terminal leave or immediately post-separation is realistic. Expecting revenue in year one requires a specific strategy (subcontracting first, or targeting specific small-dollar sole-source opportunities).

Resources: VBOC (Veteran Business Outreach Center), Procurement Technical Assistance Centers (PTACs — free contracting consulting available in every state at aptac-us.org), and the SBA's own federal contracting guides at sba.gov.

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Sources: SBA.gov federal contracting, SAM.gov, VetCert (veterans.certify.sba.gov), FAR Part 19, National Defense Authorization Acts, APTAC (aptac-us.org)