Getting a women-owned business certification grants opportunities that range from management training to being given priority for government contracts.
Let’s go through what is certification and how to register as a woman-owned business, as well as the advantages of women-owned business certification.
What Is Women-Owned Business Certification?
Women-owned business certification is a document that provides qualified businesses access to a web of resources and opportunities for set-aside government contracts.
Certification is offered by the Small Business Administration (SBA) and the Women’s Business Enterprise National Council (WBENC), awarding the Women-Owned Small Business (WOSB) certification and the Women’s Business Enterprise (WBE) certification, respectively.
Historically, women-owned businesses have struggled to obtain funding, mentorship or partnership opportunities, or be selected for lucrative contract work. With women-owned small business (WOSB) certification, the federal government and national and regional partner organizations aim to level the playing field.
WOSB vs. WBE Certification: Fast Facts
The SBA WOSB program exposes your brand to national, regional and local government entities. The SBA devotes at least 5% of its contracting dollars to businesses run by women. So this visibility is an important step in competing for contract dollars. Also, many local municipalities will provide discretionary spending to some women-run companies earmarked for B2B transactions.
Some companies may qualify for Economically Disadvantaged Women-Owned Small Business certification (EDWOSB). There are even more opportunities afforded to those who qualify.
EDWOSB certification requires that your business has been kept from capital and credit opportunities, like bank loans, that others have been afforded.
While the WBENC can match you with corporate partners that can award you contract opportunities, the focus is more on intangible benefits, including:
- Access to successful entrepreneurial mentors
- Management and technical education
- Valuable networking opportunities
Advantages of Women-Owned Business Certification
Each program offers distinct ways of boosting your business, but there are also general benefits to becoming a certified business enterprise.
An important but often overlooked reason to get certified is that it makes your business more appealing. It’s similar to Better Business Bureau accreditation: it isn’t a surefire way to make more money, but it increases exposure and lets others know they can trust your company.
If you rely on B2B transactions and vendors, you may see an uptick in business. Some programs, such as the WOSB federal contracting program, will mandate that a certain percentage of their business go to them.
There are also federal tax incentives, including reduced tax liabilities, for working with women-owned small businesses.
WOSB Certification Benefits
The Small Business Administration offers many financing programs for companies in need of funding. However, many are unaware of the advantages minority and women-owned businesses receive working with them.
While there are no specific business loans for women, SBA WOSB certification offers you many other potential financial and educational benefits.
WOSB Federal Contracting Program
One of the main advantages of women-owned business certification is the potential to compete for lucrative government contracts.
Thousands of government contracts are awarded to female-owned businesses each year. While participation in the WOSB program doesn’t guarantee contract dollars, here are the ways it can limit the number of competitors.
Competitive Set-Aside Contracts
To meet their 5% quota, agencies will set aside certain government contracts for a woman-owned business, or minority-owned business, that’s certified. The goal is to award contracts in industries where women are underrepresented.
EDWOSBs are favored because, in any other circumstance, they’d have a harder time accessing these projects. You’ll still need to bid, but certification might position your business over non-certified entities also vying for the contract.
Sole-Source Contracts
Unlike their counterparts, sole-source contracts eliminate the bidding process. If your company is the only one that can fulfill the project, you can be given access to lucrative contracts, up to $4 million for goods and services and $6.5 million for manufacturing jobs.
Education
Much like the SBA 8(a) program for disadvantaged business enterprises, WOSB certification allows you to apply for the Mentor-Protege program.
Through this program, you can connect with business owners that can help you grow, offering some great advantages:
- Marketing, accounting, technical and management training
- Potential financial assistance in the form of investments, loans and bonds
- Support through the federal contracting program process
- Business development and strategy training
WBE Certification Benefits
National Women’s Business Enterprise certification aims to help nurture women-owned businesses by providing an array of different resources.
Corporate Partners
WBENC certification gives you access to the organization’s corporate partners, including Fortune 500 companies such as AT&T, Dell, IBM and Walmart.
When your WBENC application is approved, you’ll be placed in their database, where companies can search and find you when they need someone to fulfill a contract. They also boast a list of hundreds of supplier diversity and procurement executives that focus on working with women-owned businesses.
Conferences and Networking
The WBENC has multiple annual regional and national events to help you further professional connections with other business owners who can give you the tools to grow. And one day you can help a young entrepreneur grow her business.
At these events, including their annual Summit & Salute and National Conference & Business Fair*, you can gain access to the following resources:
- Face-to-face matchmaking sessions with potential mentors and clients
- Ability to have an exhibit booth at events
- Informal networking and targeted marketing
- Opportunities to partner with other WBEs for joint-ventures
*Note: The 2020 Summit was a virtual event due to the COVID-19 pandemic.
Education
Events also include workshops and keynote speeches that provide valuable insight into successfully running a business. Recurring webinars, newsletters and blog articles will also be shared with you, covering topics pertinent to the challenges of women-owned businesses.
Marketing
With WBENC certification, women-owned businesses get a boost in their marketing strategies. You’ll be able to proudly advertise your certification, bringing in customers who want to support female entrepreneurs.
The WBENC may also feature your company for stakeholders to find online, adding another avenue for business exposure.
How to Get Certified
Here’s how to apply for a women-owned business certification.
General Requirements
The SBA and WBENC have 2 main requirements:
- The business must be at least 51% controlled by a female who is a U.S. citizen. For public companies, women must control at least a 51% stake.
- You must also show that you manage the day-to-day operations of your company and have a hand in all decision-making and strategy.
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Small Business Tip: Economically disadvantaged women-owned small business certification offers more advantages but, to be eligible, you and your business will have to meet the following criteria:
- A female owner’s personal net worth must not exceed $750,000
- The owner’s average gross salary must not be over $350,000 during the last 3 years
- The female owner can’t have more than $6 million in personal assets
How To Get WOSB Certification
Because you’re working with the government and, in turn, public tax dollars, the SBA has a thorough vetting process for women-owned small business certification.
You’ll first need to register on the System for Award Management (SAM) website. This makes you eligible to bid for government contracts, and the SBA will pull from your SAM profile when assessing your application.
Next, you’ll have the option to either self-certify or go through a third-party organization.
WOSB Self-Certification
The WOSB certification process is fairly simple. All you need to do is go to the SBA’s self-certify site and create a profile. There, you’ll answer a few questions about your business and upload some financial documents before the application is processed.
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WOSB Certification Checklist
What you’ll need to apply for WOSB certification will depend on your business entity and industry, but you should generally have the following on hand before applying:
- Proof of citizenship
- 3 years of business tax documents
- Bank statements, profit and loss reports and any other pertinent financial data
- Articles of incorporation, bylaws and amendments (if applicable)
- Stock ledgers (if applicable)
If you wish to apply for EDWOSB certification, the SBA requires a few more documents:
- 3 years of personal tax returns
- 3 most recent W-2s
- Completed and signed IRS Form 4506-T
WOSB Third-Party Certification
If you don’t want to self-certify, some organizations can help you through the WOSB certification process. Regional nonprofits and chambers of commerce can point you in the right direction, but there are 3 main national organizations you can use:
- National Women Business Owner Corporation
- U.S. Women’s Chamber of Commerce
- Women Business Enterprise National Council
Each will have similar processes, but fees might vary. Check with a representative from each to learn more and find your best fit.
When you receive WOSB third-party certification, you’ll have to submit proof to the SBA before using any of the program’s benefits.
How Long Does It Take to Get WOSB Certification?
A thorough, correctly completed application can be processed within a few weeks to a month, depending on whether the application panel needs additional information or a site visit.
Once approved, you’ll have to follow up once a year for an annual review to retain your status.
Note: If you’re already enrolled, your SBA 8(a) economically disadvantaged women and minority-owned business certification can be used to obtain WOSB status.
How to Get WBE Certification
The WBE certification process is similar to the SBA process. Both use the same general criteria, but the WBE certification process breaks it into 2 parts: a document review and a site visit.
Most of the documentation required is consistent with WOSB certification, but there are a few additional required documents, including:
- Information regarding partnerships, employees, business structure
- Personal financial documents
After creating an account on their site, the WBENC will ask that you provide all of the documentation and answer a few questions about your business. They’ll then schedule a site visit to speak with you and any of your partners if they deem that you may be a fit for certification. This step ensures all information is correct and paints a clearer picture of your company.
The process takes about 90 days and, if approved, you’ll be certified for one year. After that, you’ll be required to go through the recertification process, which is much quicker.
Fees are based on your revenue and range from $350 to $1,250 per year.
