As a small business owner, you want to take advantage of any opportunity to level out the playing field of competition. Women-owned small businesses have a program designed to help get equal access to funding and federal contracts. Our content partner Nav.com explains this certificate, why you should certify, and how to do it.
If you own a business, you’re undoubtedly always looking for ways to increase its growth. Fortunately for female business owners, the Woman-Owned Small Business (WOSB) and Economically Disadvantaged Woman-Owned Small Business (EDWOSB) certifications give you access to resources and government contracts that can help you stimulate your company’s growth.
What Is the Woman-Owned Small Business (WOSB) Certification?
The WOSB is a program coordinated by the Small Business Administration (SBA) with the goal of giving women-owned businesses more easier access to the resource they need to grow their business. The Economically Disadvantaged Woman-Owned Small Business (EDWOSB) certification is a subset of the WOSB program. These certifications offer the chance to compete fairly for federal contracts and gain access to resources tailored to promoting women in business.
Advantages of Certification
Over 20 years ago, the federal government set a goal for awarding 5 percent of government contracts to small businesses owned by women. That goal has been elusive, but was finally met in 2015 when 5.05 percent, or $17.8 billion, of all federal contracting dollars that were eligible for small businesses were awarded to WOSBs.
In addition to the contracting goal, federal contracts can be “set aside” for WOSBs in industries where WOSBs are underrepresented. This helps ensure that small businesses owned by women are competing on a more level playing field with other similar companies.
The federal government uses the North American Industry Classification System (NAICS) to classify businesses. In fact, the SBA has authorized 113 new NAICS Industry groups for WOSB and EDWOSB set asides, 92 NAICS groups have set asides for WOSBs and 21 for EDWOSBs.
Requirements for Certification
To qualify as a women-owned small business, or WOSB, your business must meet the following requirements:
- Your company must qualify as a small business based on SBA small business size standards. The standards are usually stated in terms of employee size and/or annual revenue, and vary depending on your industry code.
- Your company must be 51 percent owned by women who are U.S. citizens.
- Women must manage the operations on a daily basis.
- Women must make long-term decisions for the company.
- A woman who works full-time for the company during normal work hours must hold the highest officer position in the company.
- There are no rules governing time in business.
To qualify as an economically disadvantaged women-owned small business, or EDWOSB, your business must meet the WOSB requirements, and the owner of the company must demonstrate economic disadvantage in the following ways:
- Personal net worth is less than $750,000 with some exclusions
- Adjusted gross income averaged over three years of $350,000 or less with some exclusions
- Fair market value of all assets (no exclusions) of $6 million or less
How to Get Certified
There are two ways to become certified. You can self-certify, or one of the organizations approved by the SBA can certify your company.
You can register at Sam.gov and wait 24 hours before registering at Certify.SBA.gov to complete a self-certification. To register via these websites, you will need a DUNS number, an EIN, and MPIN. You can get an EIN now by applying online, however registering for a free DUNS number will take about 30 days.
While the self-certification process has been eliminated for contracts set-aside under the WOSB program, that change isn’t currently effective. Until the SBA implements the change, you may continue to self-certify.
Currently, the SBA has approved four organizations as “TPCs,” or third-party certifiers:
- El Paso Hispanic Chamber of Commerce
- National Women Business Owners Corporation
- U.S. Women’s Chamber of Commerce
- Women’s Business Enterprise National Council (WBENC)
TPCs charge a fee to provide certification and annual recertification that currently ranges from approximately $200 to $400.
Once you are a certified WOSB, you can search for federal contracting set-asides on FedBizOpps.gov. Additionally, you’ll have the opportunity to qualify for grants specified for women owned businesses. (Learn more about grants for women-owned businesses here.)
A WOSB certification can help make it easier for you to grow your business. As an entrepreneur wearing a dozen different hats, anything that “makes it easier” to obtain one of your business goals is worth considering incorporating into your business plan.
This article originally appeared on Nav.com and was re-purposed with their permission.
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