$543 Million Is the New “Small”? SBA Wants Your Feedback

The SBA is proposing a change that could fundamentally reshape the small-business market for marketing communications firms.

Today, size standards across NAICS 5418 generally range from approximately $19 million to $32.5 million in average annual receipts. SBA is proposing replacing those with a single standard:

$543 million.

Yes, $543 million.

There is an important caveat. The proposed methodology would include paid media billings, which have historically been excluded when determining agency size. That means $543 million isn't an apples-to-apples comparison with today's thresholds.

But even accounting for media, it's an enormous number.

Only the very largest federal advertising contracts would come close to generating that level of annual media billings. The overwhelming majority of federal marketing and communications contracts are nowhere near it.

Including media explains why the threshold should increase. It doesn't necessarily explain $543 million.

And that's where we think agencies should pay attention.

We understand the problem SBA is trying to solve. We've watched many successful independent firms build strong federal practices, graduate from small-business status and suddenly face a very different competitive landscape.

There should be a better path for those companies.

But allowing a $5 million or $10 million agency to compete as a “small business” against a firm with hundreds of millions in annual billings creates a different challenge. Those firms aren't similarly situated when it comes to past performance, proposal resources, systems, financial capacity or the ability to absorb the cost and risk of pursuing federal work.

There could also be a second-order effect that matters enormously to our industry: bigger contracts.

Government contracting attorney Steven Koprince has raised the possibility that dramatically higher size standards could make agencies more comfortable consolidating smaller requirements into larger procurements. After all, if firms approaching $500 million still qualify as small, an agency could reasonably conclude that a much larger and more complex requirement remains appropriate for a small-business set-aside.

That could leave many of today's small agencies “small” on paper—but increasingly unable to compete for the work.

Subcontracting could change as well. Newly classified small businesses would generally no longer have small-business subcontracting-plan obligations, while large primes would gain a much larger pool of sizable firms they can use toward small-business goals.

The government could ultimately report more dollars going to small businesses while fewer genuinely small marketing communications firms receive them.

This is still a proposal. Make your voice heard.

Comments are due September 21, 2026, and we strongly encourage marketing communications firms that participate—or want to participate—in the federal market to weigh in.

Tell SBA what this would actually mean for your agency: competition, contract sizes, subcontracting opportunities, past-performance requirements and your ability to grow from an emerging federal contractor into a sustainable one. If you support $543 million, say so. If you think the current standards are too low but $543 million goes too far, explain where you think the balance should be.

What's important is that the marketing communications industry has a voice in a rule that could shape its federal competitive landscape for years to come, https://www.federalregister.gov/documents/2026/08/20/2026-17042/small-business-size-standards