Female entrepreneurs continue to encounter distinct challenges in accessing funding and government contracts. To address these obstacles, various programs and designated funds are now available specifically for women-owned businesses. However, simply owning a business as a woman isn’t sufficient; companies must adhere to specific certification requirements to qualify.
Understanding Women-Owned Business Certification
A Women-Owned Small Business (WOSB) certification is an official recognition granted by the U.S. Small Business Administration (SBA). This certification allows businesses to access programs and contracts specifically reserved for women-owned enterprises.
Types of Certification for Women-Owned Businesses
Two primary types of women-owned small business certifications are recognized by the SBA: Women-Owned Small Businesses and Economically Disadvantaged Women-Owned Small Businesses. Below is a breakdown of each:
- Women-Owned Small Business (WOSB): This is the fundamental certification that requires companies to be at least 51% owned and managed by women.
- Economically Disadvantaged Women-Owned Small Business (EDWOSB): This certification not only requires that the business be women-owned but also that the owners meet certain criteria indicating economic disadvantage, alongside possessing an 8(a) certification related to economically disadvantaged ownership.
Benefits of Women-Owned Small Business Certification
Designating your company as a women-owned small business can bring various advantages:
- Increase Access to Government Contracts: Numerous government agencies are mandated to allocate a portion of their contracts to women business owners. Certification enhances visibility and expands opportunities to secure these contracts.
- Expand Your Customer Base: Many corporations prioritize diversity and support women entrepreneurs, creating potential contracting or sales opportunities beyond government partnerships.
- Build a Network: Certification can facilitate access to networking events and opportunities targeted specifically at female entrepreneurs, helping you connect with like-minded business owners.
- Access to Educational Resources: The SBA and various organizations offer guides and tools designed to support women-owned businesses in areas such as financing and marketing.
- Find Mentorship: Certification can assist in connecting with experienced female mentors who can guide you through your entrepreneurial journey.
Requirements for Women-Owned Business Certification
To be eligible for certification benefits, businesses must meet the following criteria:
- Operate as a small business, complying with SBA size standards, generally requiring fewer than 1,500 employees.
- Be at least 51% owned and controlled by women who are U.S. citizens.
- Have women actively participating in management roles, overseeing daily operations and long-term business decisions.
Steps to Obtain Women-Owned Business Certification
If you are interested in securing a women-owned business certification, follow these steps:
- Verify Eligibility: Confirm that at least 51% of the business is owned by women who are U.S. citizens and, for EDWOSB, demonstrate economic disadvantage. Use the SBA’s eligibility tool for guidance.
- Compile Required Documents: Gather necessary business and personal documents to substantiate your eligibility, including proof of citizenship and various business agreements.
- Submit Application: Utilize the SBA’s online application system to complete your certification process.
- Explore Third-Party Certification Options: There are organizations authorized to provide third-party certifications, each with unique procedures and fees. Directly reach out to these entities for application details.
Cost of Women-Owned Small Business Certification
The SBA’s certification process is free; however, third-party certifications may incur costs, generally covering their services and assistance throughout the certification process.
Distinguishing Between WOSB and EDWOSB
The Women-Owned Small Business (WOSB) designation necessitates a minimum of 51% ownership and operation by women who are U.S. citizens. In contrast, the Economically Disadvantaged Women-Owned Small Business (EDWOSB) requires proof of economic disadvantage in addition to WOSB requirements. Both certifications enhance government contracting opportunities, but EDWOSB may provide additional benefits.
Duration of WOSB Certification
The SBA grants WOSB or EDWOSB certification for a duration of three years, after which re-certification is available, typically requiring a simpler process than the initial application.
