SBA Doubles the Veteran Contracting Goal to 10%: What VOSB and SDVOSB Firms Should Do Now

The U.S. Small Business Administration has doubled the federal contracting goal for veteran-owned small businesses — from 5% to 10% — for fiscal year 2027. SBA announced the new goal on November 9, 2026, the first day of National Veterans Small Business Week, and it applies to both prime contracts and subcontracts. The goal covers veteran-owned small businesses (VOSBs) and service-disabled veteran-owned small businesses (SDVOSBs) together, as one combined category.

This is the largest single increase in the veteran contracting goal in the program's recent history: the SDVOSB goal was 3% until the FY2024 National Defense Authorization Act raised it to 5%, and the new FY2027 goal doubles that again — while also widening the counted population from SDVOSBs alone to VOSBs and SDVOSBs combined.

But a goal is not a set-aside, and it guarantees no firm a single dollar. This guide explains what SBA actually changed, what a contracting goal does and does not do, who qualifies as a VOSB or SDVOSB, and the four moves a veteran-owned firm should make now — plus the two companion announcements SBA made the same week: new 7(a) loan flexibility for veterans buying a business, and a VetsinTech pilot for the drone sector.

What changed: the FY2027 goals

SBA sets annual prime contracting and subcontracting goals for every federal agency under the Small Business Act. The goals are agency-level targets: each agency is measured against them, and SBA publishes the results in its annual Small Business Procurement Scorecard. For FY2027, SBA set the following goals:

Two things are new at once. First, the number: 10%, up from 5%. Second, the population: the goal now counts veteran-owned and service-disabled veteran-owned firms together, as one combined category. The previous 5% goal covered SDVOSBs only. A VOSB that is not service-disabled now counts toward this new combined FY2027 target.

SBA Administrator Kelly Loeffler framed the change as support for the defense industrial base. In the announcement she said:

“The Trump SBA is proud to establish historic federal contracting goals – doubling the 5% objective to 10% – for veteran-owned and service-disabled veteran-owned small businesses, who are among the most competent and critical contractors,” said SBA Administrator Kelly Loeffler. “Veteran entrepreneurs deliver unmatched products and services that bolster our Main Streets and our military readiness.”

She added that in the defense industry, small businesses make up 70% of the industrial base. The kickoff event in Washington, D.C., on November 9 featured Vice President JD Vance, Loeffler, Department of Veterans Affairs Secretary Doug Collins, and Department of Agriculture Secretary Brooke Rollins, in a cosponsorship with the D'Aniello Institute for Veterans and Military Families at Syracuse University.

What a contracting goal is — and what it is not

This is the part most coverage skips, and it matters more than the headline number. A contracting goal is an agency-level target. It tells federal agencies how much of their contracting dollars SBA expects them to direct toward a category of small businesses, and it holds them accountable through the public Scorecard. It does not do any of the following:

• No set-aside. It does not set aside any contract. Set-asides are a separate mechanism: a contracting officer restricts a specific competition to a category of firms. The goal does not create a set-aside.
• No guaranteed dollars. It does not guarantee any firm work. Agencies still run competitions, and firms still have to win them on price, past performance, and capability.
• No eligibility change. It does not change who is eligible. Only certified firms count toward the goal — with a narrow, SDVOSB-specific exception for firms whose complete application was submitted by December 22, 2024 and is still pending (see below) — and certification rules are unchanged.

The November 9 releases do not explain how the new combined 10% goal will be measured alongside the existing statutory 5% SDVOSB requirement. The Small Business Act requires a government-wide goal of at least 5% of prime and subcontracting dollars for SDVOSBs — that requirement still stands. Whether agencies will be scored on the combined 10%, on the 5% SDVOSB floor, or on both is not explained in those releases. Until SBA clarifies the measurement, treat the 10% as the direction of travel, not as a precise promise about how any single agency will be scored.

The honest reading, then, is this: the goal may increase agencies' incentive to buy from veteran-owned firms, and it widens the counted population to include VOSBs. Agencies that were already missing the 5% SDVOSB goal now face a 10% combined target, and they may look harder for certified veteran-owned suppliers. But the work still goes to firms that are certified, visible in the systems agencies search, and competitive on the contract itself. The rest of this guide is about becoming one of those firms.

How we got here: 3% to 5% to 10%

The veteran contracting goal has moved twice in three years. Until the FY2024 National Defense Authorization Act, the government-wide SDVOSB goal was 3% of prime and subcontracting dollars. That Act raised it to 5%. Agencies then beat the 5% goal in FY2025, with $32.5 billion in prime contracts to SDVOSBs. The FY2027 announcement doubles the target again to 10% — and counts VOSBs alongside SDVOSBs toward the new combined target.

The certification pipeline grew with the goal. SBA said it cleared a backlog of more than 2,700 Veteran Small Business Certification (VetCert) applications that had accumulated before the current administration, and in FY2026 it approved more than 18,000 contracting certifications for veteran-owned small businesses. A larger certified population is what makes a 10% goal plausible: a firm's dollars count toward the goal once it is certified — SDVOSBs with a complete application submitted by December 22, 2024 keep eligibility while SBA decides — so a bigger certified pool gives agencies more suppliers to buy from.

The broader small-business picture gives the goal its context. The Small Business Act requires the federal government to award at least 23% of federal prime contracting dollars to small businesses — a target the government has exceeded for eleven consecutive years, according to SBA. Qualifying veteran-owned prime-contract awards can also count toward the overall small-business goal. The veteran target is not calculated as 10% of the 23% small-business target.

Who qualifies: VOSB vs SDVOSB

VOSB and SDVOSB are two different statuses from one certification program, SBA's Veteran Small Business Certification (VetCert). Both require the same foundation: the firm must be small under the SBA size standard for at least one NAICS code in its SAM.gov profile, and qualifying veterans must unconditionally and directly own at least 51% of the business and control both its long-term decisions and its day-to-day operations. The rules are in 13 CFR Part 128.

The difference that matters commercially is the last row. A certified SDVOSB can compete for set-aside and sole-source opportunities at every federal agency. A certified VOSB can compete for set-asides at the VA, under the Vets First program, but not government-wide. Both count toward the new combined 10% goal — which is why the goal's expansion to VOSBs is meaningful for veteran-owned firms that are not service-disabled: their dollars now move an agency's score.

Certification runs through SBA, not the VA. Responsibility moved from the Department of Veterans Affairs to SBA on January 1, 2023, under the FY2021 National Defense Authorization Act. SBA's VetCert program is now the sole federal certification portal for both statuses, and certification is free. Firms apply through MySBA Certifications.

VetCert has its own eligibility rules and document checklist, which are different from the 8(a) program's — start with SBA's VetCert guidance at sba.gov/vetcert, and apply through MySBA Certifications.

Two transitions govern certification, and they have different dates — and both are written for SDVOSB credit. For non-VA SDVOSB set-aside and sole-source awards, SBA certification has been required since January 1, 2024 — a contracting officer must confirm that SAM.gov shows the firm as SBA-certified, and firms that submitted a complete application by December 31, 2023 kept transitional treatment while SBA reviewed it. (VA contracts are excluded from that transition — VA set-asides have always required verification.) For SDVOSB goaling and subcontracting credit, the grace period for self-certifying ended on December 22, 2024 — but SDVOSBs that submitted a complete application by that date keep eligibility until SBA decides on it. A firm that still lists itself as veteran-owned in SAM.gov without a VetCert certification, and without a complete application submitted by December 22, 2024 that SBA has not yet decided, does not count toward any agency's goal. SBA has not yet published implementation guidance on how VOSB counting will work under the new combined goal — until it does, treat the VOSB counting mechanics as unconfirmed.

What VOSB and SDVOSB firms should do now

The goal changes what agencies are looking for. It does not change what a firm has to do to be found. Four moves, in order:

1. Get VetCert-certified — or check that your certification is current

Certification is the entry ticket for goal-counted dollars: a firm's dollars count toward an agency's target once it is certified — SDVOSBs with a complete application submitted by December 22, 2024 keep eligibility while SBA decides. Agencies still buy on capability and price, but certification is what makes those dollars count toward the 10%. If your firm is veteran-owned and not yet certified, start the VetCert application through MySBA Certifications now — SBA has said it intends to maintain a 30-day average for deciding complete applications, though complex ownership structures take longer. If you are already certified, confirm the certification is current and that SAM.gov shows it: that is what a contracting officer checks.

Start at certifications.sba.gov (MySBA Certifications), and confirm your SAM.gov registration lists the right NAICS codes and shows your veteran-owned status.

2. Align your NAICS codes with what agencies actually buy

A firm counts toward the goal only in the NAICS codes where it qualifies as small, and agencies search by NAICS. Check that your SAM.gov profile lists every NAICS code you can genuinely perform in — and that your capability statement leads with the codes where veteran-owned demand is strongest, which for this goal means the defense industrial base and the agencies that buy from it.

Our Company NAICS Lookup shows which NAICS codes a company actually won awards under in FY2025 — use it to see where the dollars in your industry sit before you rewrite your capability statement.

3. Make yourself findable to the agencies that now have to hit 10%

Agencies that were already struggling to hit 5% now face a 10% combined target. They will be looking for certified veteran-owned suppliers — but they look in the systems they already use: SAM.gov, agency vendor databases, and the SBA's own resources. A current SAM.gov registration, a clear capability statement, and registration with the agencies you target are the minimum. Watch the Small Business Procurement Scorecard when FY2027 results publish: it shows, agency by agency, who is hitting the goal and who is short — and a short agency is an agency with a reason to take your call.

To see which agencies buy the most, and from whom, start with our Top Federal Contractors ranking and the Contractor Finder — the dollars are concentrated, and the top of the list is where the subcontracting opportunities sit.

4. If you are buying a business, use the 7(a) window before it closes

The 7(a) equity flexibility SBA announced the same week is a separate opportunity with a hard end date: it runs through the end of FY2027, September 30, 2027. If you are a veteran considering buying an existing business, the next section explains the terms — and the window is the point. A temporary rule rewards firms that move while it is open.

The other two announcements: 7(a) loans and the VetsinTech pilot

The goal was one of three initiatives SBA announced during National Veterans Small Business Week. The other two matter to different veteran founders — one buying a business, one building in the drone sector.

7(a) equity flexibility for veteran business acquisitions

From Veterans Day, November 11, 2026, through the end of FY2027 (September 30, 2027), eligible veterans buying an existing business with an SBA 7(a) loan can fund the entire required 10% equity contribution from permitted outside sources — seller standby notes, investor capital, or other outside equity. Previously, outside sources could cover no more than half of the 10%; the veteran had to bring the rest from personal savings. The 10% equity requirement itself has not changed — only where it can come from.

SBA's stated reason is the wave of owners preparing to retire and sell: its Office of Advocacy found that 51% of owners of businesses with employees are 55 or older. The flexibility is explicitly temporary — it is a window, not a permanent rule — and it applies to eligible veteran buyers acquiring an existing business through the 7(a) program. A veteran buyer who was short on personal savings and therefore locked out of an acquisition can now close the same deal with outside capital, provided the lender and SBA approve the structure.

VetsinTech pilot for the drone and dual-use aerospace sector

SBA is launching a national pilot program with VetsinTech to deliver training, capital access support, and procurement pathways for veteran founders in the $10 billion drone and dual-use aerospace sector, drawing on a 120,000-member network. The pilot is aimed at veteran founders entering the defense supply chain through drones — a sector where the government is actively trying to build domestic suppliers. The pilot funding amount was not disclosed in SBA's releases: what is announced is the program, its sector, and its three parts — training, capital access, and procurement pathways.

The scale of veteran-owned business

The goal is aimed at a large population. More than 1.8 million veteran-owned small businesses in America employ four million workers, generate $1.3 trillion in annual sales, and pay $258 billion in payroll, according to SBA. Seven percent of the nation's 632,000 small manufacturers are veteran-owned — the manufacturing base the defense industrial base draws on.

SBA's own lending to the population is substantial: in FY2026 it approved more than 2,800 loans for veteran-owned small businesses totaling $1.32 billion in federally backed capital. Its resource network includes 51 Veterans Business Outreach Centers, and its Boots to Business entrepreneurship courses have trained and graduated nearly 260,000 service members, veterans, National Guard and Reserve members, and military spouses since 2013.

Frequently asked questions

Sources

• SBA — “SBA Doubles Federal Contracting Goal to Expand Opportunity for Veteran-Owned Small Businesses” (November 9, 2026) — the FY2027 goals, the $32.5 billion FY2025 baseline, the VetCert backlog and certification figures, and the Loeffler quote.
• SBA — “SBA Opens National Veterans Small Business Week 2026” (November 9, 2026) — the three NVSBW initiatives, the 1.8 million-firm scale figures, FY2026 lending and certifications, the VetsinTech pilot, and the 7(a) equity waiver.
• SBA — “SBA Establishes New 7(a) Equity Flexibility for Veterans’ Small Business Acquisitions” (news release 26-117, November 9, 2026) — the 7(a) equity flexibility window, beginning Veterans Day, November 11, 2026, through FY2027, and the prior 50% cap on outside sources.
• 13 CFR Part 128, Veteran Small Business Certification Program — VOSB and SDVOSB eligibility, the 51% ownership and control tests, the VA disability determination, and the certification transitions in §128.200(c).
• SBA VetCert program — the sole federal certification portal for VOSB and SDVOSB status since January 1, 2023; applications through MySBA Certifications at certifications.sba.gov.

This article is general information about the SBA announcement of November 9, 2026, as of November 11, 2026. It is not legal or financial advice. The 10% figure is an agency-level contracting goal, not a set-aside and not a guarantee of contract dollars. Program rules change — confirm certification requirements and loan terms on the linked SBA pages before acting. The VetsinTech pilot funding amount was not disclosed in SBA's releases.