Businesses owned by women are profitable, generating over $1.7 trillion in sales annually. Historically, women have faced societal, legal, and economic barriers to becoming business owners. Although it is no longer legal to discriminate in lending or hiring practices on the basis of sex, the federal government is proactively working to help women overcome the results of historic discrimination through woman-owned business benefits like the Women-Owned Small Business Certification.
What is the Woman-Owned Business Certification?
The Small Business Administration offers two classifications for businesses owned by women: Women Owned Small Businesses (WOSB) and Economically Disadvantaged Women Owned Small Businesses (EDWOSB).
According to the SBA, to qualify as a WOSB, your company must meet the following criteria:
- Female, U.S. citizens own and control at least 51% of the business
- Qualify as a small business under SBA size standards
- Business is managed day-to-day by women
- Women make the long-term decisions for this business
Your business might qualify as an EDWOSB if it meets all of these requirements, and is also owned by women who meet the following personal financial criteria:
- Personal net worth of less than $750,000
- Less than $350,000 adjusted gross income over three years
- Personal assets worth less than $6 million
Applying for recognition as a WOSB or EDWOSB means that you can prove to the SBA that you meet the above criteria and can therefore compete for government contracts as an official woman owned busines.
Benefits: Increased Competitiveness
Applying for WOSB or EDWOSB status allows you to bid on government contracts under the Women-Owned Small Business Federal Contracting Program. The federal government has committed to awarding at least 5% of all its contracts annually to women-owned businesses. Completing the certification process is required to be considered as part of that 5%. Additional woman-owned business benefits include access to networking and training opportunities that help women succeed as business leaders. Training programs, conferences, and databases that promote diversity in supply chains are all accessible to businesswomen in this program. Aside from federal contracts, other businesses seeking to promote diversity look for the woman-owned business certification when looking for vendors and business partners
How Can my Small Business Become Certified?
The woman-owned small business certification can take up to 90 days to process, so it’s a good idea to begin gathering your documentation as early as possible. In general, you will be required to submit proof of ownership and citizenship, along with tax documentation for your business, management information, and a brief narrative history of your business.
You can apply directly through the Small Business Administration, and some states and cities offer additional certification programs through their own local offices. You can check here to find a list of all the documentation you will need for your application.
There is a wealth of resources available to women interested in growing as small business owners. Certification as a woman-owned business is one avenue to access more contract opportunities along with training and educational resources. Check out additional resources specifically for businesswomen that cover opportunities for financing, professional organizations, and more.