how 8 a firm status works
the 8 a status is specially granted by the sba to any small business that qualifies making it eligible for financial assistance training mentoring and other forms of assistance in order to qualify for this special status businesses must be owned and operated by individuals who are considered socially and economically disadvantaged these individuals may have been subject to racial or ethnic prejudice or cultural bias the 8 a status is outlined specifically in section 8 a of the small business act and is designed to help small disadvantaged businesses compete in the general market the federal government has a stated goal of awarding at least 5 of federal contracting dollars every year to these businesses 1the purpose of the 8 a business development programone of the main reasons behind the creation of the 8 a status was to increase business involvement by a broader portion of society the sba identifies several groups that are eligible for 8 a status including black americans hispanic americans native americans asian pacific americans and subcontinent asian americans someone who is not a member of one of these groups may still get into the program if they can show significant evidence of having been socially disadvantaged for instance due to race ethnic origin gender and physical handicap among other causes through the 8 a business development program owners can compete for special contracts such as sole source government contracts for which there are no competitive bids that help level the playing field for their small businesses these small businesses can use the program to form joint ventures with already established businesses to form mentor prot g relationships as well as for management and technical assistance businesses must meet certain requirements to be eligible to be a prot g qualifications for 8 a firm statusin order to qualify to become an 8 a firm under sba guidelines a business must meet the following criteria effective july 15 2020 1title 13 part 124 of the code of federal regulations cfr spells out who qualifies for the 8 a program as well as what counts as being economically and socially disadvantaged small businesses with 8 a status can receive sole source contracts up to a ceiling of 4 million for goods and services and 6 5 million for manufacturing owners interested in taking part in the program are encouraged to do an on line training and self evaluation course through the 8 a business development suitability tool the course helps entrepreneurs determine whether or not their company meets the qualifications for the 8 a program and if it does not directs them to an appropriate sba resource before a firm can participate in the 8 a program it must first be certified at certify sba gov and small businesses that want to use the certification website must have a profile at sam gov which is where companies register to do business with the u s government contact your local sba office if you have questions about applying once you have applied the administration will send a notification letter explaining whether the business was accepted into the 8 a program the certification lasts for nine years the first four years are considered to be developmental while the remaining five are deemed to be a transition phase small businesses that gain 8 a status are subject to annual reviews in order to keep the designation and their good standing in the program during these reviews the business owner has to draw up business plans and undergo systematic evaluations entrepreneurs who have secured 8 a firm status say that the application process can be lengthy and rigorous having prior experience with government contracts can be helpful and working hard to take advantage of the program s benefits can make the experience very rewarding 