This is the final entry of our 5-part series to help small business owners evaluate whether federal certification is right for their business. You can read previous installments from the series by clicking on the links below.
Does attracting potentially millions of dollars’ worth of new business interest you? With government contracting work, you can open the doors to additional business that larger companies are not eligible to receive. For instance, government agencies and corporations that do business with the government are mandated by law or corporate policies to spend approximately 20 percent of their budget with small, disadvantaged companies.
Many federal, state, and city contracts that are set aside for certified small businesses go unclaimed because those businesses do not know how to be recognized as a small business. Certification is a review process designed by the certifying agencies to ensure that the business is actually owned, controlled, and operated by applicants that are an underserved group such as women, minorities, or veterans. Each program, however, comes with unique rules and compliance hurdles.
Be cautioned that the Small Business Administration (SBA), the agency responsible for approving four of the five programs we will discuss in this series, denies a large percentage of the applications it receives. For example, the SBA rejects approximately 70 percent of applications under the 8(a) Business Development Program. If your application is rejected, all of the programs require that you wait a mandated time period before reapplying, in many cases one full year. Moreover, once you do reapply, your application will likely receive closer scrutiny the second time around. To have the best chance of getting certified, your application must be fully and correctly completed, with all proper documentation accompanying the application.
Below is the last of five main federal certification programs we will discuss in this small business series.
Women Owned Small Business Program
It took 10 years, but in 2010 the SBA enacted a program to promote women-owned businesses by providing that at least 5 percent of all federal prime contracting dollars flow to women owned businesses. The women-owned small business program (WOSB) provides for special contracting preferences to businesses owned and controlled by women. It is similar to other small business programs, and also includes a special subprogram designed for economically disadvantaged women-owned businesses (EDWOSB).
The WOSB can provide a tremendous amount of benefits. The program authorizes contracts to be set aside for industries where women-owned businesses have been underrepresented. Therefore, before applying for the certification, you will want to confirm that your industry is underrepresented. The program is designed to help women-owned businesses level the playing field so that WOSBs may compete more effectively.
To qualify for the WOSB program, your small business must:
- Qualify as a small business under the NAICS code assigned to a particular procurement;
- Be at least 51 percent unconditionally owned by one or more women who are U.S. citizens; and
- Be unconditionally controlled by one or more women who are U.S. Citizens.