Over 20 years ago, the government outlined a goal to award “at least five percent of all federal contracting dollars to women-owned small businesses each year.” This followed research revealing that many corporate and government agencies didn’t recognize the advantages of contracting with women-owned businesses. The goal was met in 2015 when $17.7 billion of federal contracting dollars available for small businesses were awarded to Women-Owned Small Businesses (WOSB).
The main certification program for woman-owned businesses seeking to increase their growth is WOSB, run by the Small Business Association (SBA). According to the SBA, "Government agencies reserve contracts for small businesses that are certified in the SBA’s contracting programs."
There is also a subset of the WOSB program: the Economically Disadvantaged Women-Owned Small Business (EDWOSB) certification. Both WOSB and EDWOSB are nationally recognized certification programs that facilitate access to federal contracts “set aside” specifically for WOSBs in underrepresented industries, leveling out the playing field for small businesses owned by women.
Additionally, WOSB certification allows women-owned businesses to be a part of the North American Industry Classification System (NAICS), which is used by the federal government to classify businesses. The Small Business Association aims to increase the number of industries included in the certification of WOSB, so more women-owned businesses can benefit.
Ultimately, becoming a Women Business Enterprise (WBE) and gaining access to federal contracting money helps to provide more growth opportunities and financial assistance for woman-owned businesses that would otherwise not have been possible.
You can certify your company as a woman-owned business in one of two ways. You can either self-certify or certify through an SBA-approved third-party certifier.
To self-certify, you use the certify.SBA.gov website, which will require you to answer questions about your business (e.g. individual proprietorship, limited liability company (LLC), partnership, or corporation) and upload documents depending on whether you’ve previously participated in SBA programs. While planning for this, reference the SBA’s preparation checklist which tells you everything you’ll need throughout the certification process.
Alternatively, you can apply to be certified by one of four approved third-party certifying agencies:
- National Women’s Business Owners Corporation (NWBOC)
- Women’s Business Enterprise National Council (WBENC)
- U.S. Women’s Chamber of Commerce
- El Paso Hispanic Chamber of Commerce (EPHCC)
You will then need to provide proof of your business certification through certify.SBA.gov, closely following the listed instructions. Each third-party certifier has its own benefits, requirements, and unique application process:
The National Women’s Business Owners Corporation (NWBOC)
The National Women’s Business Owners Corporation (NWBOC) offers a national certification program to both WOSBs and EDWOSBs. Information about the application and its various requirements regarding ownership, control, size, and NAICS codes are available on the website.
Alternatively, NWBOC offers a handy application kit, which can ease business owners through the process. There is a $400 minimum fee for the application and it takes from 6-8 weeks to process the certification.
NWBOC is appealing for women who want national certification and who hope to benefit from additional resources like mentoring programs, funding, and training opportunities.
The Women’s Business Enterprise National Council (WBENC)
The Women’s Business Enterprise National Council (WBENC) certification can be the quickest and the least expensive of all the options. It is free and immediate for WBENC members, and for non-members the cost starts at $350 and takes around 90 days to process. There is a checklist and guide online to help companies complete the application.
WBENC certification itself is “accepted by more than 1,000 corporations, plus many federal, state and local government entities,” according to Forbes. It is also a provider of WOSB certification, but not EDWOSB certification.
Preparing for WBENC WBE Certification
To get ready for WBE certification, Director of Certification at the Women’s Business Enterprise National Council Lakesha White advises business owners to follow three steps:
- Gather all of the required documentation. For documents that do not apply to your company, please provide a written explanation stating which documents do not apply and why. Ensure each document is available electronically for uploading. Click here for Documentation Required.
- Review your legal and financial information, especially legal documents (i.e. Bylaws, Operating Agreements, etc.) to ensure that your documents support woman/women ownership and control.
- Review pages 9-15 of the WBENC Standards and Procedures.
Obviously preparation varies depending on which business certification you intend to apply for, but generally the advice stands: gather required documentation ahead of time, review legal and financial documents, and read the certifying agency’s standards, procedures, and requirements.
If you are confused and need assistance with WBE certification, reach out to the agency’s regional partners or other representatives.
The U.S. Women’s Chamber of Commerce (USWCC)
As opposed to WBENC, the U.S. Women's Chamber of Commerce (USWCC) does offer Economically Disadvantaged Women-Owned Small Business (EDWOSB) certification in addition to WOSB. It takes around 15-30 days with a cost of $275 for members and $350 for non-members.
Unlike the other options, the entire application process is to be completed online (there are no in-person/physical components). Like the others, there are a checklist and sample application available. The online application has to be completed in one sitting.
The El Paso Hispanic Chamber of Commerce (EPHCC)
The El Paso Hispanic Chamber of Commerce (EPHCC) offers Minority Business Enterprise (MBE) and Women’s Business Enterprise (WBE) certifications. The cost of these certifications ranges from around $350 to $1,200 each, depending on the region.
According to the website, you start by contacting the MBDA Business Center-El Paso at (915) 351-6232. Then, business development specialists will “assess your business, provide you with a standardized application, and review the most often requested documents to support your minority status claim.”
Qualifications to become a certified woman-owned business vary depending on the certification for which you apply.
Here are the general requirements for the women’s contracting program, according to the SBA website. Your business must adhere to the following guidelines to become a Women-Owned Small Business (WOSB) and secure access to more funding:
- Qualify as a small business as per the SBA small business size standards, which generally use employee size and/or revenue as measures.
- Be at least 51% owned and controlled by a woman or women who are U.S. citizens.
- Be managed by women on a day-to-day basis. Women must also be the ones making long-term decisions for the company.
- The highest officer position in the company must be held by a woman on a full-time basis, during normal work hours.
Your business must adhere to the following guidelines to become an Economically Disadvantaged Women-Owned Small Business (EDWOSB):
- Have a personal net worth of less than $750,000. (There are some exclusions.)
- Have an adjusted gross income average over three years of $350,000 or less. (There are some exclusions.)
- Have a fair market value of all assets of $6 million or less. (There are no exclusions.)
The full rundown of qualifications is available online in the Code of Federal Regulations. There is also the option to get a preliminary assessment by the SBA’s Certify website to see if you’ll qualify.
The key benefits of women-owned business certification are that it helps establish credibility for your business, increases visibility, and opens your enterprise up to opportunities that would otherwise be inaccessible, such as the following:
- Access to educational opportunities such as training programs
- Networking opportunities and mentorship programs
- Increased recognition and promotion for your business
- More access to money through federal government contracts
WBENC Senior Manager of Certification Kelly Hinman outlined a few of the many competitive advantages of WBE certification with her agency: “Once certified you have access to a current list of supplier diversity and procurement executives at hundreds of major U.S. corporations and federal, state, and local government entities that accept WBENC certification. Certification enables eligibility to participate in MatchMaking sessions, access to mentoring, education, and capacity development.
The full list of WBENC advantages is online — and the same is true of most of the other providers.
- How long does it take to become a certified women-owned business?
Depending on the type of certification, it can take 15 to 90 days from when the full documentation is received, but you should plan far in advance because timing can be somewhat unpredictable.
- What are the different types of women-owned business certification?
To review: There are four main types of certification. The first is the core SBA Women-Owned Small Businesses certification. Then, there are the third-party providers, including the National Women’s Business Owners Corporation (NWBOC), the Women’s Business Enterprise National Council (WBENC), the U.S. Women’s Chamber of Commerce, and the El Paso Hispanic Chamber of Commerce.
- What is the difference between federal and state certification?
Federal certification benefits those looking to primarily do business with the private sector. State certification is for businesses with slightly smaller scope. For example, if you want to do business with your local medical center, you don’t need federal certification. It entirely depends on your target customers.
- How much does it cost to become a certified women-owned business?
Certification fees vary depending on the provider, but generally range from around $350 to $1,250 depending on the size of your business/revenue. It can cost nothing for businesses that are already members of certain certification agencies.