Business Women

February 21, 2022 | Growth and Expansion

How to Get Certified as a Women or Minority-Owned Small Business

Small business certification comes in many forms and offers incredible opportunities for business owners to work with and compete with larger businesses for contracts. Federal government agencies and many state and local governments must set aside a percentage of their contracts to small businesses, including women-owned and minority-owned businesses. In today’s article, I’ll review how you can get certified as a woman or minority-owned small business.

How Do I Get Certified as a Woman-Owned Business?

There are two types of women-owned business certifications: Women’s Business Enterprise (WBE) and Women-Owned Small Business (WOSB).

Women’s Business Enterprise (WBE)

Women’s Business Enterprise (WBE) is a designation used by state and local governments, plus many private sector organizations committed to offering opportunities to women-owned companies. Previously, you could self-certify your business; however, you must now go through one of the Small Business Administration’s (SBA) approved third-party organizations:

You can also look for WBE certification through one of the State Offices for Minority and Women Business Enterprises or through your local government office—although the certification may only be suitable for doing business with that particular government.

While each organization has its own process, requirements, and eligibility guidelines, in general, WBE certification requires applicants must:

  • Be a for-profit business located in the United States
  • Have 51% ownership by a woman, or a group of women
  • (When applicable) have a woman-controlled governing board
  • Have a woman as its top executive officer who is responsible for daily operations and has experience in the company’s primary business activity

In addition, applicants for WBE status must be U.S. citizens or legal residents.

Women-Owned Small Business (WOSB)

Women-Owned Small Business (WOSB) is a designation used by agencies of the federal government committed to offering contracts to women-owned companies. In fact, the federal government’s goal is to award at least 25% of federal contracts to small businesses in general and 5% specifically to female business owners. In addition, qualified business owners can apply to have an Economically Disadvantaged Women-Owned Small Business (EDWOSB) designation, a subcategory of the WOSB for economically-disadvantaged entrepreneurs.

To be eligible for the WOSB Federal Contracting program, a business must:

  • Be a small business according to SBA size standards
  • Be at least 51% owned and controlled by women who are U.S. citizens
  • Have women manage day-to-day operations and make the long-term decisions

To qualify as an EDWOSB, a business must:

  • Meet all the requirements of the WOSB Federal Contracting program
  • Be owned and controlled by one or more women, each with a personal net worth of less than $750,000
  • Be owned and controlled by one or more women, each with $350,000 or less in adjusted gross income averaged over the previous three years
  • Be owned and controlled by one or more women, each with $6 million or less in personal assets

To apply for certification, women business owners should start at the SBA’s certification website and answer eligibility questions. Once the application deems you eligible, you will be guided to use the SBA to get certified or be given a list of the approved third-party certifiers.

To help you navigate through the process, the SBA offers application checklists and a list of required documents. Next, you are guided to obtain a DUNS number (required), register for SAM (System for Award Management), where you’ll find contracting opportunities, and create your SBA account.

The application requires some or all of the following information and documentation (depending on your business type and ownership):

  • Company name and fictitious business name (“Doing Business As” DBA)
  • Owners’ names, addresses, and company website
  • The company’s legal structure
  • Incorporation date
  • A list of each proprietor, partner, shareholder, or member within the 12 months preceding the date of the application
  • DUNS number (from Dun & Bradstreet)
  • Any affiliate relationships
  • Contact information for regular clients
  • Business and/or personal loans
  • Employee information
  • Birth certificate, current passport, or naturalization papers
  • Driver’s licenses of all owners
  • EIN (Federal Tax ID)
  • Resumes of all owners, directors, partners, officers, and key personnel
  • Current bank statements for all deposit accounts and loan statements
  • Financial institution signature cards
  • Documentation of how the company was capitalized
  • Financial statements for three years, including balance sheet, profit & loss statement
  • Tax returns for the past three years
  • Assumed/fictitious name certificate
  • Authority to conduct business in the state and/or certificate of good standing issued by Secretary of State
  • Articles of incorporation and articles of amendments filed with Secretary of State
  • Bylaws and amendments
  • Statement of information filed with Secretary of State listing officers, directors, managers, members, or general partners
  • For LLCs, articles of organization and operating agreements
  • Copies of all corporate stock certificates
  • Minutes of corporate shareholders and directors’ meetings
  • Shareholder agreements
  • Partnership agreements
  • Professional, industry, and/or business licenses
  • Copy of lease or deed for business location

Then, once a year, businesses need to update their certification information through both the Dynamic Small Business Search database and beta.certify.sba.gov.

How Do I Get Certified as a Minority-Owned Business?

Another critical certification is the minority-owned business certification. Like WBE and WOSB, federal, state, local, and large businesses reserve a percentage of their contracts exclusively for minority-owned businesses (MBEs).

The National Minority Supplier Development Council (NMSDC) is a membership association with 23 regional affiliate councils nationwide, plus 1,450 corporate members representing public and privately-owned large corporations. NMSDC promotes supplier diversity through education and networking opportunities and offers an official certification process for minority-owned businesses.

Qualifications for certification include:

  • The business owners must be U.S. citizens
  • The business must be at least 51% minority-owned, operated, and controlled. (Per the NMSDC, a minority must be at least 25% Asian, Black, Hispanic, or Native American. Also, minority eligibility is established through screenings, interviews, and site visits. For publicly-owned businesses, at least 51% of the stock must be owned by one or more minority group members.)
  • The business must be for-profit and physically located in the U. S. or its territories.
  • The minority owners must also participate in the daily management and operations of the business.

To start the certification process, fill out the online application on the website of the regional NMSDC affiliate located closest to your business. The documentation required varies by business type, but you can prepare by gathering information on:

Once you get approved, you’ll receive notification via e-mail and postal mail. To find federal and state contracting opportunities, start with the Small Business Administration’s (SBA) contracting website, where you will find helpful links to procurement opportunities and useful guides on how to bid. Also, check with your local affiliate to attend business opportunity fairs, training, and networking events. You must be re-certified annually by providing current tax forms and contact information changes.

What is an SBE Certification?

Small Business Enterprise (SBE) Certification is a bit different from the other small business certifications described above in that it is not one designation from one source. Many organizations and local governments offer SBE certification, and each has its own set of guidelines and requirements. You might have to meet qualifications such as a maximum number of employees or sales numbers.

In addition, getting SBE certification from one entity does not necessarily qualify your business for SBE certification status elsewhere. For example, getting SBE certified for the City of Los Angeles may open your business to numerous contracts throughout Los Angeles but not anywhere else. But, getting SBE certification through several organizations and councils can only increase your opportunities to gain new business and widen your sales base.

Now That You’re Certified

Once you get a certification, it is crucial to stay involved and make the most of your designation. Put official logos on your website to spread the news and use the certificate in all your marketing materials and as part of your email signature.

Procurement opportunities are lucrative but take a lot of hard work to bid on and usually have a lengthy vetting process. When applying for state, local, and corporate projects, search state, city, or company websites for bidding opportunities. Finally, make sure you know the deadlines and requirements to stay compliant.

<a href="https://www.corpnet.com/blog/author/nellieakalp/" target="_self">Nellie Akalp</a>

Nellie Akalp

Nellie Akalp is an entrepreneur, small business expert, speaker, and mother of four amazing kids. As CEO of CorpNet.com, she has helped more than half a million entrepreneurs launch their businesses. Akalp is nationally recognized as one of the most prominent experts on small business legal matters, contributing frequently to outlets like Entrepreneur, Forbes, Huffington Post, Mashable, and Fox Small Business. A passionate entrepreneur herself, Akalp is committed to helping others take the reigns and dive into small business ownership. Through her public speaking, media appearances, and frequent blogging, she has developed a strong following within the small business community and has been honored as a Small Business Influencer Champion three years in a row.

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