A short document, usually one page, that a buyer or another contractor can scan in under a minute: what you do, your codes and certifications, past performance, and how to reach you. It is not a marketing brochure. Agencies read dozens of these while doing market research, so the ones that survive are specific about what the business actually does, not what it aspires to do.

In a sentence

"Interested firms are encouraged to submit a capability statement to the point of contact listed above." That is your shot at getting in front of the buyer before a contract even exists, so put your NAICS codes, certifications, and past work on it, not a mission statement.