Here’s the Step-By-Step Process to Become a Woman-Owned Business

Gaining the designation is laborious, but it can give your PRO company a leg up on the competition when it comes to government contracts.

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QUESTION: My husband and I have owned and operated our company for several years. What do I do to become a woman-owned business? How will such a designation help our company?

ANSWER: A woman-owned business is the designation of a company that, once the requirements are met, is eligible for certain set-aside programs offered by U.S. government agencies, large companies with government contracts and certain industry associations. 

         Terri operated our company, Pit Stop Sanitation Services in Atlanta, as a certified woman-owned business. According to Terri, this program presents opportunities for which your company may not otherwise be eligible. One cautionary and important point she makes: Do not rely on this special designation as a major source of obtaining business. Certification should merely complement your company’s commitment to quality service and a high level of customer satisfaction in all business sectors.

         According to the U.S. Small Business Administration, the federal government’s goal is to award “at least 5% of all federal contracting dollars to women-owned small businesses each year.” Clearly this certification can be of benefit to qualified PROs.

         Two designations of women-owned businesses are “Woman-Owned Business Enterprise” (WBE) and “Woman Owned Small Business” (WOSB). The basic requirements for both are straightforward but stringent. The core principle is that the business be at least 51% owned by one or more female American citizen that operates and controls the business on a daily basis. In addition, the business must meet the requirements for a small business.

WOMAN-OWNED SMALL BUSINESS (WOSB)

         The WOSB certification program is administered by the SBA and, in addition to the 51% minimum ownership requirement, it also looks at the size of the business according to certain industry standards, primarily NAICS codes. (For reference in completing various forms in this process, NAICS is the North American Industry Classification System and replaced the older Standard Industrial Classification (SIC) system in 1997. The NAICS code for portable toilet rental, service and cleaning is 562991.)

         As of this past July 15, the SBA made several changes to this program, and as of October 15, the SBA began issuing decisions on certifications. The updated WOSB Federal Contracting Program regulations can be found at beta.certify.sba.gov.

         One important change in the October 2020 process is that third-party certified documentation can be used for this certification as well. (The third-party process for certifying as a “Woman-Owned Business Enterprise” (WBE) is described below.) Self-certification is no longer an option.

         Another key component of this program is that certification must be updated annually through both SAM.gov (System for Award Maintenance) and the previously mentioned beta.certify.sba.gov system.

WOMAN-OWNED BUSINESS ENTERPRISE (WBE)

         The WBE certification program is provided by several third-party organizations that also offer network and training opportunities with fellow members and other industry representatives.

The four organizations approved by the SBA are:

     • Women’s Business Enterprise National Council (WBENC) –

        www.wbenc.org

     • National Women Business Owners Corporation (NAWBO) –

        www.nawbo.org

     • U.S. Women’s Chamber of Commerce – www.uswcc.org

     • El Paso Hispanic Chamber of Commerce – www.ephcc.org

         Terri was a long-standing member of WBENC and using this organization as an example will illustrate the goal of these third-party organizations.

         WBENC is the largest of these organizations and their certification standard is accepted by over 1,000 corporations in addition to many federal, state and city entities. They offer support, resources, targeted marketing and networking opportunities. The WBENC National Conference and Business Fair is their largest event to assist certified women-business owners. This organization offers the WBENClink2.0 D Internet Database and is an excellent source of information and includes a repository of certified WBEs.

         Fourteen Regional Partner Organizations work with the WBENC to administer certification across the U.S. Refer to the WBENC database, at wbenc.org, for the most convenient regional partner.

         WBENC is also an approved third-party certifier for the SBA WOSB Federal Contracting Program.

CERTIFICATION PROCESS AND SUGGESTIONS

         As you might imagine, paperwork is involved. But keep in mind that this is a process that not every business owner is eligible to participate in, so an investment of your time will benefit your company in the long run.

         Certification is a two-part process: online application and documentation and then a site visit. Preparation in advance will make the entire process run smoother and faster.

         Your company must possess three key numbers for you to begin the application process. The Federal Employer Identification Number (FEIN) should already be established for your company as it is used extensively in the annual income tax process. The second number is a DUNS number (Data Universal Numbering System). The third number that is required to work with the federal government is an SAM number (System for Award Management).

         The DUNS number is a proprietary system developed by Dun & Bradstreet in 1963 for credit reporting practices. Over time, the DUNS number was so widely adopted by industry and trade associations throughout the world that in 1998 it was incorporated as the U.S. federal government’s contractor identification code. One phone call to Dun & Bradstreet at 866-705-5711 will complete this process at no charge. Once on the phone, indicate that you are a federal grant applicant and inquire if your company already has an assigned number. If so, record the number and you are finished. If you do not have a number, remain on the line and you will be assigned a DUNS number for your company.

         The SAM number (System for Award Management) is found on an official website of the federal government that allows your company to do business with any entity within the U.S. government. By proceeding in the recommended order of operations that has been described in this column, the requirements for a SAM number are easily met. Merely sign on to the website sam.gov and enter your company’s FEIN number and DUNS number. The SAM number must be renewed annually.

         The only additional requirement is your company’s banking information to set up electronic funds transfer (EFT) payments from your governmental customer for timely invoice payments.

STEP 1: ONLINE APPLICATION PROCESS

         With all the government-required identification numbers established, the application process is straightforward. The best advice is to thoroughly complete one step before going on the next. Our advice is to think of the adage, “How do you eat an elephant? One bite at a time.” Please keep in mind that all this information is confidential with the certification committee. 

         GENERAL INFORMATION: This is a major point in the application process. You will sign an affidavit that you own at least 51% of the company and this document is then notarized.

         OWNER IDENTIFICATION: You must present an accepted form of identification (generally a driver’s license) as well as proof of U.S. citizenship.

Financial information: Current financial statements, federal tax returns, any loans and real estate leases are the basics of this requirement. In addition, your corporate resolution and bank signature card will give further evidence of your role in the company.

         PERSONNEL INFORMATION: Employee payroll information as well as W2 or 1099 records for all owners, officers or directors of the company for the most recent year.

         MANAGEMENT INFORMATION: Your resume in addition to any other legal employment documents you may possess, such as consulting agreements with other individuals or companies.

         GOVERNANCE INFORMATION: These are legal documents that define your company as a sole proprietorship, partnership or corporation.

After completion of the online application, you are assigned an applicant number and the data is then analyzed.

STEP 2: SITE VISIT

         Once notified that the application is complete and meets all requirements, a site visit is arranged. The objectives of this visit by a member of the certification committee are to:

     • Meet the applicant one-on-one.

     • Discuss the application in terms of any questions or

        additional information needed.

     • Tour the facility and better understand the business.

     • Have short conversations with several of the employees to ascertain

        their views of the company as well as to ensure that the owner-

        applicant has a day-to-day presence in the business.

         After the site visit is complete and, once approved, you are certified as either a WBE or a WOSB.

RENEWAL

         The certification renews annually, and the goal is to merely verify the information that is on file and to update any changes in the business. As previous noted, do not forget to also renew your SAM registration annually.

FINAL THOUGHT

         While good customer service, high employee satisfaction, effective sales and good financial management are keys to success in your business, additional certifications can create a competitive advantage. The WBE and WOSB certification programs are intense, laborious, thorough and complete. While some of the requirements may seem detail-oriented, keep in mind that this ensures only qualified contractors will be certified. These certifications can lead to increased business and that is an asset to your company.  



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