What the 67% SDVOSB Spending Increase Means for Small Businesses in 2026

The federal government has quietly shifted the rules in favor of veteran-owned small businesses — and the numbers are significant. The National Defense Authorization Act for FY2024 increased the federal spending goal for Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) from 3% to 5% of all prime and subcontract dollars. That's a 67% increase, pushing the annual target to over $31 billion.

In FY2025, federal agencies awarded $28.6 billion across approximately 52,000 contract actions to SDVOSB firms — with institutional pressure building to close the gap toward the new $31 billion target. If your business holds SDVOSB certification, this is the moment to be positioned, visible, and ready to win.

What Changed and Why It Matters

Before 2024, the SDVOSB set-aside goal was 3% of federal spending — a target many agencies met passively. The new 5% mandate changes the dynamic. Agencies that fail to hit the goal must now submit corrective action reports to the SBA, creating real institutional accountability.

Additionally, as of December 22, 2024, only SBA VetCert-certified businesses count toward agency spending goals. Self-certification is no longer enough. If you haven't completed the VetCert process, you're effectively invisible to contracting officers working to hit their numbers.

The good news: the SBA cleared its VetCert backlog in late 2025, reducing average processing time to just 12 days. The window to get certified and positioned is open right now.

The Stacking Advantage: SDVOSB + HUBZone

One of the most powerful — and underutilized — strategies in federal contracting is certification stacking. SDVOSB can be combined with HUBZone, 8(a), or WOSB certifications, giving your firm access to multiple set-aside categories simultaneously.

H&C Precise Logistics holds both SDVOSB and HUBZone certification — a dual-certification that gives federal contracting officers two compliant, set-aside eligible pathways when working with our firm. In practice, this increases the number of solicitations we're eligible to compete on and makes us a more attractive partner for prime contractors pursuing set-aside subcontracting requirements.

What This Means If You're Not Yet Certified

If your business is veteran-owned but not yet SDVOSB-certified, the $31 billion target is money on the table you can't access. Here's the practical checklist:

1. Verify your SAM.gov registration is active and current (annual renewal required)

2. Complete SBA VetCert application — average processing time is now 12 days

3. Evaluate HUBZone eligibility based on your business location and employee addresses

4. Update your capability statement to lead with your certifications and NAICS codes

5. Identify set-aside contract opportunities on SAM.gov filtered by SDVOSB or HUBZone

How H&C Precise Logistics Can Help

H&C Precise Logistics LLC is a dual-certified SDVOSB and HUBZone firm based in Durham, NC. We don't just help businesses navigate the certification process — we use these certifications ourselves to win and execute federal contracts, including a Department of Veterans Affairs award in FY2025.

Our government contracting consulting services include certification guidance, SAM.gov support, capability statement development, proposal support, and post-award compliance. If you're ready to position your business to compete for your share of the $31 billion SDVOSB market, we offer a free consultation — no obligation, just a straight conversation about what's possible.

Contact H&C Precise Logistics at hcprelog.com or call 888-420-0228 to book your free consultation today. Learn more about our government contracting services at hcprelog.com/services.