What is a Small Business Size Standard?
Also known as: SBA size standard, Size standard
A small business size standard is the maximum size a firm can be — measured in average annual revenue or number of employees — and still qualify as 'small' for a given NAICS code. SBA sets a size standard for every NAICS code, and the standard on a solicitation's NAICS decides who counts as small.
How size is measured
- Revenue-based standards use average annual receipts (commonly over the last 5 fiscal years for receipts-based codes).
- Employee-based standards count the average number of employees, including affiliates.
- Affiliation rules can combine the size of related companies, so ownership ties matter.
Why it matters
Because each NAICS code has its own standard, a firm can be 'small' under one code and 'other than small' under another. Picking the right NAICS and tracking your size status is essential to bidding set-asides correctly.
Frequently asked questions
How is annual revenue calculated for size?
For receipts-based NAICS codes, SBA generally uses a 5-year average of annual receipts, including those of affiliates. Employee-based codes use a 12-month average headcount.
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