The Rule of Two: How Insiders Use Veteran Status to Shape Procurement

In the world of federal contracting, the “Rule of Two” is the most powerful regulatory lever a veteran can pull. While most people view set-asides as something that happens to them, industry insiders know how to make set-asides happen for them. Federal Contracting Center works with savvy veteran owners to use their status proactively, shaping the acquisition strategy before the solicitation even hits the street.
The insider strategy revolves around market research. Contracting officers are overworked and risk-averse. They are required to conduct market research to determine if two or more capable SDVOSBs exist. If they find them, they must set the contract aside. The problem is, they don’t always look very hard. This is where your SDVOSB certification becomes a weapon. Instead of waiting for an RFP, insiders send a “Capabilities Statement” and a “Sources Sought” response directly to the contracting officer, often teaming up with another veteran-owned firm. By presenting two capable firms proactively, you essentially force the Rule of Two. You turn a potential full-and-open competition into a limited SDVOSB set-aside.
Another critical angle is the “Kingdomware” decision. This Supreme Court ruling solidified the mandate that the VA must prioritize veterans above all other contracting preferences. Insiders know that this applies even to Federal Supply Schedule (FSS) orders. If you are on a GSA Schedule and you are an SDVOSB, you can push for the VA to restrict schedule buys to veterans only. This is a massive market share protection that many novice contractors fail to enforce.
We also see smart firms leveraging the “Non-Manufacturer Rule” waivers. If you are a veteran-owned reseller, you can win supply contracts even if you don’t make the product, provided the manufacturer is a small business or a waiver exists. This allows SDVOSBs to act as value-added resellers for massive IT and medical procurements. The certification is the ticket, but understanding the FAR clauses is how you win the game.
Ultimately, the certification is just the entry fee. The real success comes from knowing how to wield that status to influence the acquisition strategy. It’s about teaching the government how to buy from you.
Conclusion
The SDVOSB status is a strategic tool that, when used correctly, can shape the market in your favor. By understanding the Rule of Two and proactive marketing, you can secure set-asides that eliminate your competition.
Call to Action
Stop waiting for contracts and start creating them. Leverage industry expertise to maximize your veteran advantage. Visit http://www.federalcontractingcenter.com to master the insider game.