What Is a Certified Woman-Owned Business?
The origin of certification programs can be traced back to 20 years ago when researchers revealed the severe lack of corporate and government agencies contracting with women-owned businesses. The U.S. government reacted with a goal to award “at least five percent of all federal contracting dollars to women-owned small businesses each year.”
This was achieved in 2015 when 17.7 billion of federal contracting dollars available to small businesses were awarded to Women-Owned Small Business (WOSB). Since then, the government has continued to expand its goals and the resources made available for female entrepreneurs.
The main certification program for women-owned businesses seeking to increase their growth is WOSB, run by the Small Business Administration (SBA). There is also a subset of the WOSB program: the Economically Disadvantaged Women-Owned Small Business (EDWOSB) certification. Both are nationally recognized certifications that facilitate access to federal contracts “set aside” specifically for WOSBs in underrepresented industries, leveling out the playing field for women-owned businesses.
Alternatively, women business owners in California have the option of using one of the SBA-approved third-party certifiers:
- National Women Business Owners Corporation (NWBOC): This organization aims to unite millions of women-owned businesses to advocate for the advancement for all.
- Women’s Business Enterprise National Council (WBENC): WBENC promotes diversity whenever possible and helps businesswomen become certified to go further in their careers.
- U.S. Women’s Chamber of Commerce (USWCC): This organization gives women in business the resources and work they need to grow in confidence and leadership.
- El Paso Hispanic Chamber of Commerce: This resource connects, advises, and coaches women business owners. It also advocates for female entrepreneurs and provides Minority Business Enterprise (MBE) and Women’s Business Enterprise (WBE) certifications.
What Are the Qualifications to Become a Certified Woman-Owned Business?
Qualifications 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 California business must adhere to the following guidelines to become a Women-Owned Small Business (WOSB):
- 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 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 in California must adhere to the following guidelines to even be considered for an Economically Disadvantaged Women-Owned Small Business certification (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.
How Do You Become a Certified Woman-Owned Business in California?
There are two key ways for California-based businesses to get national certification. You can certify through the SBA or through an approved third-party agency. After June 30, businesswomen will no longer be able to self-certify.
The first is certification through the SBA which requires you to answer questions and upload documents (the amount depends on whether you’ve previously participated in SBA programs) through the certify.SBA.gov website. While planning for this, reference the SBA’s preparation checklist which tells you everything you’ll need throughout the process.
If you choose the SBA’s Women-Owned Small Business federal contracting program, you can apply for certification through their online portal. The SBA application involves two steps:
- Visit sam.gov (the System for Award Management)
- It’s free
- You will have to wait at least 72 hours before step 2
- Visit certify.sba.gov and complete the form
SBA’s online program is free to use, though you will still need to pay the required fees if you’re interested in receiving an actual certificate through a third-party, since the SBA does not provide the certificate itself. A certificate is not required for federal government contracts — you only need to be officially certified and listed on their women-owned business database.
If you’re still unsure about the specifics of the SBA’s Women-Owned Small Business Federal Contracting Program, you can call (800) 827-5722 or email answerdesk@SBA.gov. To speak to a representative, be prepared to wait approximately 5-10 minutes for the automated message to end and depending on their call volume, you may have a longer wait.
Alternatively, you can apply to be certified by one of the four approved third-party certifying agencies. You will then need to provide proof of your certification through certify.SBA.gov, closely following the listed instructions. Each third-party agency has its own benefits and unique application process.
In addition to the national certification, California offers a handful of local or state certification options for women in business such as the state-wide California Unified Certification Program (CUCP). The CUCP provides “one-stop shopping certification services to small, minority, and women businesses seeking to participate in the United States Department of Transportation Disadvantaged Business Enterprise (DBE) program.” After you have been certified as a DBE by the state, you can register as a DBE vendor with the Metropolitan Transportation Commission to reap the benefits.
For women-owned businesses in utility-related practices, the California Public Utilities Commission has free certification — usually granted within 45 days for a three-year term.
Finally, while not specifically for women-owned businesses, the state of California also offers a broader Small Business Certification as a part of its goal to support businesses with a principal office in California.
If you’re confused about which type of certification would be best for your business or about any part of the application process, there are a few resources that California-based businesses can visit in-person or online. For example, the Women’s Business Enterprise National Council has a regional partner, WBENC-West, which caters specifically to businesses in the Western region, including California.
On the WBENC-West website, there are businesswomen resources like online guides and webinars (including a monthly webinar walking you through certification) — there is even a quiz you can take to see if your company would be a good candidate.
Alternatively, you could benefit from WBENC-West’s various in-person women in business events which help with networking and mentorship.
Another useful resource for women-owned businesses in Southern California is the Southern California Minority Development Council (SCMDC), which represents the interests of more than 900,000 minority businesses and certifies qualifying Minority Business Enterprises.
The council also has capacity-building programs, workshops, and initiatives dedicated to helping small businesses find more businesses and advocacy efforts for minority entrepreneurs.
For the four national SBA-approved certifiers, it can take anywhere from 15 to 90 days from when the full documentation is received to process the certification. The other options, like the SCMBDC’s Minority Business Enterprises certification, also predominantly fall within that same timeline. Due to the somewhat unpredictable waiting times for certification, it is recommended that businesses plan far in advance.
Obviously preparation varies depending on which certification you intend to apply for, but generally the advice stands: gather required documents ahead of time, review legal and financial documents, and read the certifying agency’s standards, procedures, and requirements.
If your woman-owned business is denied certification, it will be because you did not meet the eligibility requirements, failed to prove you control the company and run it independently, or you did not provide the requested documents. If you prepare properly ahead of time, you should not encounter any of these issues.
What Are the Benefits of Becoming a Certified Woman-Owned Business in California?
The State of California Procurement Division purchases over $10 billion in goods and services each year and is also in charge of finding vendors and managing state contracts. This means that there is ample opportunity for local businesses to take a piece of the pie.
The main benefit of women-owned business certification is that it’s recognized by local agencies in California, other states, and private companies. It increases a business’s opportunity to be contracted for federally-funded projects and, oftentimes, certification will put you on regional/national databases used by prime contractors. As a result, certified businesses usually see sales growth and an increase in credibility on a local — or even national — scale.
Though the government predominantly does not have grants available for certified for-profit businesses, companies that create a product benefiting their whole industry can qualify for unique grants. Contact your state branch of the Small Business Development Center (SBDC) for more information on this subject. Additionally, you can explore a variety of small business grants for women.