Using Set Asides effectively in government means gaining an advantage. Set Asides are designed to level the competitive playing field for Small Businesses.
Really understanding Set Asides and how to effectively use them seems to elude a lot of Small Business owners.
In this article we will take a closer look into your Set Aside and what it means to you. Plus, you will learn a simple technique to better understand how to use the set aside best to gain an advantage.
The Purpose of a Set Aside
So what is the purpose of a set aside?
If you answered “the government mandates 23%”, you are half right. From a seller’s perspective our set aside is leverage to gain an advantage in the market.
It is because of the mandate that we are able to use our set aside to extend our reach or even limit those bidding against us.
How you ask? That’s a very good question.
Think of set asides as being a lot like playing poker. In poker we know that a flush beats a straight, and a 3 of a kind will beat two pair.
Much like poker, we are looking for the best set aside to play that will serve our best interest.
Playing your Set Aside
As an example, let’s look at a request that did not specify a preferred set aside interest; being called an unrestricted open competition bid – anyone can bid on it.
Looking over your set asides you see that you are both, a Small Business and a Hub Zone company. Because of the 10% price preference given to a Hub Company, by playing the HubZone, and not the Small Business gains an advantage.
The price preference gives an advantage over others, including large firms bidding against you. For this to work it has to be an open request and unrestricted competition. (I will elaborate on this another time.)
Another example would be a Vet and a Disabled Vet owned business. If you are proactive and know when a contract will be coming out, you can call and request it to be set for a Disabled vet preference.
Why? Simply because the Disabled Vet will narrow the amount of those bidding, more than just using the Vet owned business. Just like poker, play the best set aside for that particular situation.
If you are a woman owned business that also happens to be certified as a disabled veteran.
This makes you eligible to participate in the following set asides; WOSB, Veteran, Disabled Veteran, Small Business and Unrestricted markets (contracts with no set aside preference listed.)
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Understanding Set Asides and how to effectively use them allows you to play for an advantage in government contracts.
Other situations where playing the right set aside helps you is when a buyer has a buying preference, set aside quota or has a good rapport with you.