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Grow your business in 2023: Opportunities presented by the Women-Owned Small Business certification

It has been our great pleasure at O’Donnell, Ficenec, Wills & Ferdig to partner with entrepreneurs from all walks of life, and we salute those efforts to support underrepresented business leaders in the communities that we serve. We enjoy connecting our client-partners with opportunities, some of which are presented by Small Business Administration (SBA) programs.

The Women-Owned Small Business (WOSB) certification program got its start after H.R. 4577 (Public Law 106-554) was signed into law. This legislation spanned myriad appropriations measures and departments, from labor and education, to health and human services.

It was designed as a means of supporting the federal government’s goal to award at least 5% of its contractor dollars to qualifying businesses owned by women. A subset of WOSB is the EDWOSB (for those women who own and/or manage businesses with an “economic disadvantage” that falls under the SBA’s guidelines). Qualifying EDWOSBs are automatically also certified as WOSBs. Altogether such efforts, as the government agency behind the program will tell you, have been deployed as a mean of “leveling the playing field” for female entrepreneurship.

To make a dent on this front, the program limits competition for certain governmental contracts to those businesses that qualify for (and are participating in) the WOSB Federal Contract program. This is nothing to sniff at; the fed government is the largest buyer of products and services in the U.S. Thus far, the Department of Defense underscored strides in the “number, range, diversity and earning power” of WOSBs since the program’s inception.

“As women business owners expand their companies, they contribute to the growth of our national economy and defense,” the DoD noted on its “Office of Small Business Programs” microsite. “In Fiscal Year 2019, the DoD awarded $10.1 billion in prime contracts and $8.5 billion in subcontracts to WOSB concerns. All DoD subcontracting plans are encouraged to have a separate goal for awards to WOSBs. The DoD considers the extent of participation by small business concerns when awarding contracts.”

The strides echo and align well with broader progress related to women’s entrepreneurship. In its most recent Women-Owned Business Report (from 2019), American Express found that female entrepreneurs were fueling the economy to the tune of 42% of all businesses, with these roughly 13 million firms employing 9.4 million workers who generated revenue approaching $2 trillion.

In the past five years, the AMEX-commissioned researchers noted that the number of women-owned businesses had grown by 21%. When compared to businesses overall, these gains are even more stark; at the time of the report, the total number of businesses had grown by 9% since 2014.

Do you qualify?

The contracts that are at play relate to those goods and services within specific industries, whereby WOSB representation is lacking. At the time of this writing, nearly 650 of the 759 “eligible industries” were designated as subject to limited competition from those certified WOSB program participants.

Every five years, the SBA conducts a study to pinpoint those industries in which firms owned and controlled by women are not represented well in the federal marketplace. In turn, this approach allows for the SBA to stay up to date on progress or challenges with representation among certain groups in specific industries. Ongoing updates further help to account for emerging industries, any new or changing goods and services that may surface as technology and consumer demands evolve.

As you might imagine, the industries and sectors represented are vast. They include:

  • Numerous corners of the ag world (soybean, rice, corn, dry pea, mushroom farming and production, and on and on)

  • Energy services (i.e., biomass, geothermal, wind, solar, and nuclear electric power generation)

  • “Built environment” expertise (such as new multi-family construction, industrial building, water and sewer line construction)

  • And manufacturing in its seemingly limitless forms (from beet sugar and breakfast cereals, to stationary, synthetic dyes, soaps, and steel pipe)

For a full list of industries with contracts reserved for WOSB-certified participants (known as “set-asides”), visit here.

Aside from confirming if set-aside contracts are, indeed, in your “wheelhouse,” it is essential to check off the following requirements:

  • Qualify as a small business. The SBA has established size standards to define the largest businesses that can compete for contracts. Based largely on the number of hires and annual receipts, these standards vary by industry. You can find the guidelines here.

  • Represent a qualifying woman-owned business. By that, the SBA maintains minimum certification guidelines of at least 51% of the applicant businesses being owned and controlled by women.

  • Those women who own and control the business must be legal U.S. citizens.

  • Beyond merely having women as owners “in writing,” it is essential for the business to have women who are actively involved in both running day-to-day operations and guiding the long-term strategic direction of the venture.

You may also qualify as an EDWOSB. Requirements for the EDWOSB that go beyond the WOSB criteria mentioned above include a personal net worth of less than $750K (for any of the women who own and control the business), as well as a three-year average adjusted gross income of no more than $350K and personal assets of no more than $6 million.

What’s next?

To begin to grow your business with set-aside contracts, you must successfully complete an application form and officially become certified as an WOSB/EDWOSB. The SBA has established a specific certification site. Here, you can find checklists, resources, and instructions related to qualifying and applying for the program. Additionally, it is important to note that certification is not a “one and done” process. It is a living, breathing thing. It is essential to maintain certification. More information on that process can also be found at the certification microsite. The re-certification process, partly, includes evaluation by either the SBA or a third-party certifying body once every three years. After your “reapplication,” if you will, is successfully reviewed and OKAY’ed by the appropriate analyst, you will receive an official letter that upholds your continued eligibility as a WOSB/EDWOSB.

It is worthwhile to note that the process of gaining certification in the first place underwent some changes, which were enacted in 2020. The changes were reportedly designed to make it “easier for qualified small businesses to participate in the WOSB Federal Contract program by improving the customer experience.” These updates also aimed to, the SBA contends, strengthen oversight and ensure the integrity of the certification process. It may be particularly beneficial for those entrepreneurs who are out of the loop when it comes to the program to reacquaint themselves with any process changes.

Contact us!

It is extremely rewarding for our team to support your team. We look forward to sitting down with you, addressing any concerns you may have, and generally helping you through the ups and downs of your business’s “life.” Stay tuned for additional information on other programs and opportunities to support the sustained health and wellness of your business. In the meantime, we welcome your call. Or, you can reach out to us from our website.

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