Thresholds on the Rise: What October 1 Means for Small Business Contractors

On October 1, 2025, major acquisition thresholds shift across federal contracting—and small businesses stand to benefit. In this episode of FedBiz'5, we break down the new rules from FAC 2025-06, including the micro-purchase threshold rising to $15K and the simplified acquisition threshold jumping to $350K.

We explain what’s changing, why these thresholds move, and most importantly, how small businesses can position themselves to win more awards. From becoming purchase-card ready to sharpening capability statements and leveraging commercial item status, this episode offers practical steps to prepare before the rule takes effect.

If you want to capture more of the federal spend flowing through streamlined lanes, this is the playbook you need.

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Transcript

SAM FIELDS (host):
Hello and welcome to FedBiz'5, your quick dive into all things government contracting. I’m your host, Sam Fields, and today we’ve got some breaking news that could change the way small businesses compete in the federal marketplace.

Mark your calendars for October first, twenty-twenty-five. That’s when a new rule from the FAR Council—called FAC twenty-twenty-five dash oh six—takes effect. And with it, several key dollar thresholds jump upward to keep pace with inflation.

Now, this might sound like dry, regulatory stuff, but trust me—it matters. These thresholds determine which contracts fall into simplified lanes, which ones are set aside for small business, and how much paperwork contracting officers have to crank through before making an award. In other words, these numbers can be the difference between a slow, complex process and a quick, streamlined award that’s easier for small and veteran-owned businesses to capture.

SAM:
So what’s actually changing? Let’s start with the two headline numbers.

First, the micro-purchase threshold goes from ten thousand dollars to fifteen thousand. That means most government credit card purchases—those small buys program offices can make almost instantly—can now be up to fifteen grand. For businesses, that’s like moving from selling a cup of coffee to selling the entire lunch catering in one swipe of the card. If you can accept credit cards, keep your pricing clear, and show that you’re ready to deliver, you’ve just opened the door to a bigger slice of very fast awards.

Second, the simplified acquisition threshold—the famous SAT—jumps from two hundred fifty thousand to three hundred fifty thousand dollars. This is huge. Why? Because anything above the micro-purchase level and at or below the SAT is generally reserved for small businesses, unless the contracting officer can’t reasonably expect two or more competitive offers from small firms. By raising that ceiling, the government is putting more dollars into the small-business-friendly lane. Think of it as widening the highway for small businesses to drive on.

SAM:
But that’s not all. Several other ceilings move up too, and each one has ripple effects.

For commercial items, simplified procedures under FAR Part thirteen point five can now go up to nine million dollars. That means agencies can buy more off-the-shelf products and services using faster, streamlined methods. If you sell commercial tech, training, or professional services, this is oxygen.

For 8(a) firms, the justification threshold for sole-source awards goes from twenty-five million to thirty million. That doesn’t change who qualifies, but it does reduce some paperwork friction on the government’s side.

The threshold for requiring certified cost or pricing data—sometimes called the TINA threshold—moves from two million to two and a half million dollars. Fewer awards will trigger that heavy certification requirement, which can shorten cycles and reduce compliance risk for mid-sized contracts.

And finally, prime contractors won’t need small business subcontracting plans until awards hit nine hundred thousand dollars—up from seven-fifty—or two million for construction. That change could shift how larger primes structure teams and when they reach out to smaller partners.

SAM:
So why does the government make these adjustments? It’s all about keeping pace with inflation. The law requires the FAR Council to review acquisition thresholds every five years. The idea is that what counted as a big purchase ten years ago isn’t the same today. By raising thresholds, routine buys can still be handled quickly, while the truly large, complex purchases get the scrutiny they deserve.

SAM:
Now let’s talk about why you should care, and more importantly, how you can take advantage of these changes.

With the micro-purchase threshold moving to fifteen thousand, more money will flow through purchase card transactions. That means you need to make yourself purchase-card-friendly. Accept cards, post it clearly on your website and quotes, and have small, GPC-ready bundles that a program office can buy immediately without extra hassle.

With the SAT moving to three hundred fifty thousand, the zone for automatic small business set-asides just got bigger. That’s great news if you can deliver quick, competitive quotes. But it also means you need to make sure your SAM.gov registration and DSBS profile are completely accurate and aligned with your capability statement. That’s where contracting officers start their market research. If you’re not visible there, you’re invisible to them.

With commercial item simplified procedures now reaching nine million, agencies will lean even more on commercial comparability. That means you should highlight your products and services as commercial, publish clean price lists, and package your past performance stories so they can be evaluated quickly.

And for 8(a) firms, that thirty-million-dollar J and A threshold gives slightly more room for larger sole-source opportunities with less paperwork for the agency. That’s not a free pass, but it is a subtle improvement that could help when program needs align with your capabilities.

SAM:
Here’s your sixty-day game plan before October first. Audit your SAM and DSBS profiles—make sure your NAICS codes, keywords, and narratives reflect what you actually offer today. Tune your capability statement so it emphasizes rapid delivery, commercial pricing, and readiness for simplified acquisitions. Make micro-purchases easy—accept credit cards, post cut-off times, and even create a “buy under fifteen K” section with clearly priced products or service packages. And if you’re 8(a), pre-wire your targets. Work with your SBA rep and target agencies early so that when the opportunity arises, you’re already on their radar.

SAM (closing):
So here’s the bottom line. Raising these thresholds doesn’t guarantee contracts, but it does lower the friction in places where small businesses thrive. More buys will be automatically set aside, more commercial solutions will fit inside streamlined procedures, and fewer mid-sized awards will trigger heavy certification requirements. If you prepare now, you can catch more of this spend as it flows through faster lanes.

Thanks for listening to FedBiz'5—five minutes, countless opportunities. This episode is brought to you by FedBiz Access. For over twenty-four years, we’ve helped small and medium-sized businesses win in the government marketplace. Call a FedBiz Specialist today at 844-628-8914 and reference code GOV CON READY—that’s G-O-V C-O-N R-E-A-D-Y—for ten percent off products or services.

Until next time, I’m Sam Fields—stay proactive, stay prepared, and keep winning in government contracting.