Should Your Woman-Owned Business Get Certified?

If yours is a woman-owned small business, you might consider getting it certified. Doing so can give you market access to corporations and governments looking to do business with women-owned enterprises. Learn more about certification and the choices you have to get your small business certified.

Pros & Cons

Businesses are constantly looking to get and keep customers. A proven way do that is through word of mouth. That’s where certification can help. It allows you to be considered for larger corporate or government contracts. 

Many companies or governments have diversity initiatives to work with women-owned business. In fact, the federal government has a statutory goal of awarding at least 5% of all federal contracts to women-owned small businesses. 

In addition, consumers are motivated by woman-owned businesses. One study found that 84% of consumers want companies to support women’s rights and 87% would go out of their way to buy a product from a company who stands up for an issue they cared about.

So why aren’t more women-owned businesses certified? Some report certification can be a labor-intensive process to gather the necessary documentation and complete the application. In addition, there is the cost—$275 to $1,250 annually. But many female entrepreneurs still feel the increased visibility it provides is worth it.

Certification Basics

What types are available? You can apply for several types of certification. Federal contracts require a Woman-Owned Small Business (WOSB), Economically Disadvantaged Women-Owned Small Business (EDWOSB) or Disadvantaged Business Enterprise (DBE) certification. If you’re looking for private corporation contracts, national certification programs (WBENC, NWBOC) are often required.

Do I meet the criteria? Generally, a women-owned business must be 51% controlled by one or more women who are U.S. citizens or lawful permanent residents. “Control” means she manages the day-to-day operation of the business on a fulltime basis and is the highest ranking person. In many cases, the business must operate in the U.S. or its territories. Federal contracts also require the business meets their definition of small for that industry. 

What proof is needed? Documentation requirements vary but here’s a sample of what is required (annual recertification is often required):

  • Owner eligibility – Evidence of gender and citizenship, resumes for management team
  • Financial statements – Profit/loss and balance sheet, tax returns, debt statements, bank statements, lease agreements
  • Business information – History of business, business structure and governance, information on directors and employees, any outside agreements (consultants, service, franchise, affiliate, union) 

Certifying Organizations

You have a number of choices to certify your business. For a fee, third-party certifiers can help you manage the process, making it easier to get certified:

Small Business Administration (SBA)

The SBA allows you to self-certify, at no charge, to be part of the federal contracting system as a WOSB. Your local SBA office or Chamber of Commerce may have resources to help. Here’s a checklist to prepare your application.

National Women’s Business Owners Corporation (NWBOC)

This third-party organization offers certification for both federal and private enterprise contracting. The fee ranges from $400 to $700 based on the number of certifications applied for. 

The NWBOC also hosts conferences with networking opportunities as well as mentoring, educational and recognition programs. 

U.S. Women’s Chamber of Commerce

The Chamber provides certification for federal contracts only (WOSB or EDWOSB). A National (and International) Women’s Business Enterprise certification is included (accepted by some corporate and regional governments). The fee is $275 for members and $350 for non-members. The entire application is online and must be completed in one session.

If you also join the organization, there are events, educational and networking opportunities.

Women’s Business Enterprise National Council (WBENC) 

WBENC is another third-party certifier accepted by over 1,000 major corporations and is an approved certifier for the SBA’s federal contracting program. Their fee is based on annual gross revenue and ranges from $350 to $1,250.

Once certified, your business is entered into a database accessed by corporate purchasing managers and 14 regional partner organizations. You also get a women-owned logo to use in your marketing efforts.  WNENC also provides opportunities for education and recognition. 

Consider whether certification is right for your women-owned small business. It might set the stage for additional sources of new business.

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