At SCM Consulting, we work every day with entrepreneurs and small business owners who are ready to level up and pursue contracts in the public and private sectors. One of the most vital documents for opening those doors is the capability statement. Whether you’re bidding on a local government contract, engaging with a large prime contractor, or networking with procurement officers at an industry event, your capability statement is your business card, your resume, and your value proposition—all rolled into one.
What is a Capability Statement?
A capability statement is a concise, one-page summary that outlines the core strengths and unique offerings of your business. Think of it as your company’s professional elevator pitch in document form. For contracting professionals, this document is often the first impression they’ll have of your firm. It tells them who you are, what you do, and—most importantly—why they should consider doing business with you.
As William Osgood, President of SCM Consulting, puts it:
“We can accurately say it is a corporate version of a resume, outlining the key indicators such as the company’s core competencies, past performance, contact information, unique selling proposition, and overall capacity.”
That’s exactly why we’ve developed a signature approach to capability statements: 3CP²—Capability, Capacity, Credibility, and Past Performance. It’s the formula we use to help our clients present a clear and compelling picture of their business.
Who Needs a Capability Statement?
If you’re planning to do business with government agencies, large prime contractors, or within corporate supplier diversity programs, you need a capability statement. Period.
Government buyers, in particular, rely on this document to quickly assess whether a business is qualified to meet their procurement needs. The Department of Health and Human Services (HHS) outlines this as a must-have item in their “Get Ready to Do Business” guide, and nearly every federal agency follows a similar format.
How Do You Write a Capability Statement?
The key to an effective capability statement is simplicity, clarity, and design. Here’s how to structure it using both the HHS recommendations and SCM’s 3CP² approach:
1. Capability (What You Do)
This is where you define your core competencies. Avoid generic terms. Instead of “janitorial services,” describe how you deliver “green-certified, secure facility cleaning for medical and government buildings.” This section should highlight your expertise in a way that resonates with your target market.
2. Capacity (How You Do It)
This section should give a snapshot of your operational strength:
- Geographic coverage
- Number of employees or crews
- Relevant certifications and licenses
- Bonding capacity and insurances
- Financial stability and readiness to execute contracts
Buyers want to know you can scale up and meet the demands of the contract.
3. Credibility (Why You’re Trusted)
Here, you provide social proof. This can include:
- Awards or recognitions
- Client testimonials
- Certifications (8(a), SDVOSB, WOSB, HUBZone, etc.)
- Industry affiliations or accreditations
Credibility reinforces the quality and reliability of your work.
4. Past Performance (Where You’ve Proven It)
Highlight previous projects, especially those that are similar in scope or size to the contracts you’re pursuing. Include:
- Project names
- Contract value
- Client (when allowed)
- Brief description of the work performed
Even if your past work wasn’t for a government client, if the scope and scale are comparable, it counts.
Additional Must-Haves
According to HHS and best practices we’ve developed at SCM, your capability statement should also include:
- Company name and logo
- DUNS number (or Unique Entity ID)
- CAGE code
- NAICS codes
- Contact information
- Website and social media (if applicable)
- Business size and socio-economic certifications
And remember: design matters. A well-organized, visually appealing document will stand out more than a cluttered page of text.
Final Thoughts
A great capability statement doesn’t just say what you do—it shows how well you do it, and why you’re the right choice. At SCM Consulting, we help small businesses craft capability statements that win attention and open doors. If you’re not sure where to start or want feedback on what you already have, reach out. We’re here to help you build the tools and confidence you need to grow.
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