by Nellie Akalp
It’s 2019 and although the playing field for women-owned small businesses should be leveling out, the truth is women entrepreneurs still need some help to get a leg up on the competition. That’s where getting certified as a woman owned business can be beneficial. The federal government and large corporations are the nation’s biggest buyers of goods and services, and they often set aside contracts specifically for women-owned businesses. These contracts can be lucrative, reliable sources of income.
If you want to go after federal contracts (either as a prime contractor or subcontractor), you’ll need to get certified through the Small Business Administration (SBA). The SBA designates two categories for certification: Women-Owned Small Businesses (WOSBs) or Economically Disadvantaged Women-Owned Small Businesses (EDWOSBs). There are presently three nationwide organizations that the SBA has approved as third-party certifiers. They are:
- The Women’s Business Enterprise National Council (WBENC)
- The National Women Business Owners Corp.
- The U.S. Women’s Chamber of Commerce
You can visit their websites to see which types of certifications they offer, check their fees for certification and find out about any other beneficial programs they offer. Once you are certified, you can be added to the organizations’ databases of women-owned businesses and attend matchmaking events and trade shows they host to help women find federal and corporate contracting opportunities.
What Do You Need to Get Certified?
Depending on what type of certification you’re seeking, some requirements may vary slightly. To qualify for a WOSB, the business needs to be:
- At least 51% unconditionally and directly owned by women who are U.S. citizens
- A woman must manage the day-to-day operations
- A woman must make the long-term decisions for the business
- A woman must the hold highest officer position in the company, and
- This woman must work at business full-time during normal working hours
To qualify as an EDWOSB, you must meet the requirements above, plus have:
- Personal net worth (assets minus liabilities) of less than $750,000
- Adjusted gross income average over three years of $350,000
For more on the specifics, see the SBA website.
To prove that a woman or women own at least 51% of the company, you must show that they have direct involvement in the daily operations of the business. This is to weed out married couples where the male owner gives 51% ownership of the business to his wife, even though she is not actually involved.
There are no requirements regarding size of business or length of time in business to obtain certification. However, if your business is less than a year old, you might want to wait to apply for certification, because you will need to provide profit and loss statements, a balance sheet and your business’s prior year’s tax returns to help prove the business is actually women-owned and -operated.
In addition to these financial documents, you’ll also need to provide:
- Identification such as a birth certificate or passport
- Business plans
- Corporate documents
- Business licenses and permits
- Bank account information
- References from key clients and customers
Depending on which organization is certifying your business, an on-site visit may be necessary. For example, the WBENC requires an on-site visit as part of your initial application and then every three years thereafter as part of the recertification process. (You won’t be taken by surprise: All site visits are scheduled with the business owner in advance.)
Although it is possible to self-certify online at Certify.SBA.gov, it can be less time-consuming to get certified by one of these third parties, since they take care of the nitty gritty details for you.
Once you’re certified, it’s time to get busy announcing your new status to the world. Promote your certification on your website and in your marketing materials, take part in events held by your certifying organization, and register with FedBizOps.gov to get your business noticed by federal government agencies looking for certified women-owned businesses.
Nellie Akalp is a passionate entrepreneur, business expert, professional speaker, author, and mother of four. She is the Founder and CEO of CorpNet.com, a trusted resource and service provider for business incorporation, LLC filings, and corporate compliance services in all 50 states. Nellie and her team recently launched a partner program for legal, tax and business professionals to help them streamline the business incorporation and compliance process for their clients.
One Reply to “Why You Should Consider Getting Certified as a Woman Owned Business and How to Do It by @CorpNetNellie”
Tara L. Eggenspiller
Interesting! I didn’t even know this was an option.