The business the government has the actual contract with, and the one on the hook for delivering the whole scope of work, whether it does every piece itself or hires subcontractors for parts of it. Being prime means more paperwork, more risk, and direct access to the customer relationship. Many businesses start as subcontractors to learn the work and the customer, then bid as prime once they have past performance of their own.

In a sentence

"The prime contractor shall be responsible for all work performed by subcontractors under this task order." If something goes wrong anywhere in the chain, the government holds the prime accountable first, not whichever subcontractor actually made the mistake.