What Is a Certified Woman-Owned Business?
The woman-owned business certification came into vogue after news spread that women-owned businesses were extremely unlikely to be considered for federal, state, and even private company contracts. To encourage more women to come to the table, the federal government pledged that at least 5% of contracting funds would be for women-owned businesses. This goal is not always accomplished every year, but it has resulted in billions of dollars being distributed across the country to women-owned businesses.
To be considered for these opportunities though, the government needs you to prove that your business is both owned and operated by women. The Small Business Administration (SBA) has created the two most well-known certifications:
- Women-Owned Small Business (WOSB): Awarded to U.S. citizens who both manage the company’s day-to-day operations and set the long-term strategy of the company.
- Economically Disadvantaged Women-Owned Small Business (EDWOSB): Awarded to women owners who are financially disadvantaged.
Your Louisiana business can apply for both if you meet all qualifications and the SBA even offers an incentive to do so with a small discount in application fees. The primary difference between these certifications comes down to how funds are set aside for certain projects. You may find more opportunities for EDWOSBs in the form of set-aside funds, especially for women operating in a male-populated industry.
A federal certification is necessary for federal contracts, but not every woman will be going after these types of contracts. You can consider a National Women Business Enterprise (NWBE) certification if you’re applying for corporate or municipal contracts.
Women-Owned Business Third-Party Certifiers
The SBA is not the only certifier in the nation. You can also be certified for the WOSB by three national organizations in Louisiana:
- 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.
All three organizations have been approved to certify your business by the SBA, and you can also apply for the NWBE through these groups as well. These groups serve as advocates for business owners across the country, and work to ensure that fair legislation is drafted to protect small businesses in our community.
If certifying through a third-party, you will need to forward your WOSB and/or EDWOSB to the SBA upon approval. This is so they will have it on file and ensure your business name is added to the appropriate directories.
What Are the Qualifications to Become a Certified Woman-Owned Business?
A WOSB certification in Louisiana requires the following:
- More than half (51%) the company must be controlled and owned by women
- All women owners must be official U.S. citizens
- The business must qualify as ‘small’ as per the SBA’s rules
- The highest ranking official at the company must be a woman
An EDWOSB in Louisiana requires the following of all individual women owners:
- Must have a 3-year adjusted gross income average of $350,000 or less
- Fair market value of all assets must be $6 million or less
- Total net worth must be $750,000 or less
There is some degree of leeway when it comes to these qualifications. For example, women business owners can appeal their net worth and 3-year gross income average if they meet one of the SBA’s exemptions. If profits are reinvested into the business or income is inflated from a one-time event, these can be legitimate reasons to apply for an exemption for the EDWOSB. However, women are not allowed to appeal for any reason if their assets total more than $6 million.
The NWBE will have similar requirements and includes an on-site visit. If you are denied a certification, examiners will typically highlight the reason(s) why. This is why it’s so important to be prepared for the process before jumping in.
How Do You Become a Certified Woman-Owned Business in Louisiana?
The first step is to make sure that you meet all requirements. Luckily, there’s a preliminary test that you can take before you fill out an official application. You can also consider talking directly to the staff of the local branches of either the SBA or a third-party certifier, or check the Code of Regulations to dig deeper into the exclusions that may apply to your company.
The fees and application process may vary, depending on which organization you use to get certified. The benefits offered through each certifier will also vary. Some women will choose to go through one organization or another due to the members involved. For instance, if many of the women involved in your local WBENC are in your industry, this can be a better move for you than to go through the U.S. Women’s Chamber of Commerce.
When it comes to choosing a certification group, it may help to talk to the different local chapters in your area. Each organization has its own way of doing business, which can make it easier to decide who you want to partner with. The WBENC may cost more in fees than the SBA, but you may also find strong networking opportunities and contract application assistance. These groups may prove especially helpful if you need personalized advice about how to best use the certification within your industry.
If you’re planning on applying for the WOSB and the EDWOSB, we recommend applying at the same time as there’s a small discount in total fees. You will have the option of self-certifying for a WOSB or EDWOSB through the SBA. Additionally, the SBA provides a checklist before you apply to help prepare you for certification.
Please note that women applying prior to summer of 2020 through the SBA have the option to self-certify through their website; however, after June 30, businesswomen will no longer be able to self-certify. Instead, you will have to certify through an approved third-party agency. Alternatively, you can choose the SBA’s Women-Owned Small Business federal contracting program and 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.
The online program will be free to use, though the application fees will still be charged. You can expect to wait between 15 and 90 days for approval for your application.
What Are the Benefits of Becoming a Certified Woman-Owned Business in Louisiana?
The exact benefits of becoming certified in Louisiana will depend on your organization, but it can be an eye-opening experience if you are interested in how you can better expand your business. The firms who tend to do the best are the ones where women are underrepresented, but there are also opportunities here to change your business a little to fit the needs of the new market.
As the economy changes, your business needs to be flexible enough to keep pace. As you see the different contracts available, you’ll get a better sense of the priorities of the day. You’ll not only be eligible for certain contracts, but your business name will also be placed in the appropriate directory that organizations can turn to when they want to diversify their partnerships.
Owners will also have access to networking events, educational seminars, and informational sessions. You may be notified of contracts as they arise, which can give you more time to prepare and apply for those that interest you. In addition, you can become more involved in women-based groups if you go through a third-party, which can help you empower both your company and the larger community.
There are no specific grants available to women-owned businesses certified in Louisiana. However, you can find national grants available to women-owned businesses in your state, as well as industry-specific grants that can help your business branch out. Some women qualify for substantial grants if they make a product or offer a service that is likely to benefit their entire economic sector.
In less than two decades, the number of Louisiana’s women-owned businesses has grown by more than 76%, and was 6th in the nation for revenue growth. This shows that women have a lot of influence in the state and have every reason to continue stretching themselves to meet new goals. Certification is not right for every business, but many women business owners are impressed with the status and opportunities it affords them after they go the extra mile.