Women-Owned Small Business Programs

Key takeaways:

• Women business owners face several challenges, including less access to capital and bias in the awarding of contracts.
• Women entrepreneurs may qualify for special programs and contracting opportunities if they become certified as women-owned small businesses.
• Organizations offering certifications to women business owners include the U.S. Small Business Administration, the Women’s Business Enterprise National Council and the National Women Business Owners Corporation.

Why women-owned small businesses face funding challenges

While women make roughly 82 cents for every dollar earned by men, the gender pay gap isn’t the only economic headwind professional women face. There are also the challenges that women entrepreneurs are more likely to experience compared to their peers.

One such challenge is the difficulty of accessing financing. Women business owners are about half as likely as male entrepreneurs to have secured funds from a bank to start, operate or expand their business. Bias in the awarding of venture capital and contracts can also have a negative impact on their success.

However, some advocacy groups have made boosting support and funding for women-owned businesses a priority. If you’re a woman entrepreneur looking for ways to increase your business’ opportunities, pursuing WOSB certification or other business certifications may help. Here are some other ideas and their benefits:

What certifications are available for women-owned businesses?

There are many programs designed to help women-owned or minority-owned ventures. For instance, some companies make a point to reflect diversity in their supply chains by increasing the footprint of women-owned businesses. Certain small business grants are tailored for women entrepreneurs.

But before you can take advantage of such opportunities, you must fulfill one essential prerequisite: Become certified as a woman-owned small business. That action gives organizations proof that your business would qualify for programs designed for women entrepreneurs.

Here are some options for certification:

• The U.S. Small Business Administration (SBA) offers two certifications. You can apply for the women-owned small business (WOSB) designation or, if you fall under certain income and net worth limits, the economically disadvantaged women-owned business (EDWOSB) designation.
• The Women’s Business Enterprise National Council (WBENC), a nonprofit that supports women entrepreneurs, is the largest certifier of women-owned businesses in the United States.
• The National Women Business Owners Corporation (NWBOC) created the first certification program for women-owned businesses.

Though requirements may differ slightly depending on the certification program, your business must meet the following general criteria:

• You must be a U.S. citizen (or a lawful permanent resident for some programs).
• Women must directly own at least 51% of the business.
• Women must oversee day-to-day operations and make long-term decisions.
• A woman must hold the highest possible rank of officer.

If you apply for certification, gather documentation such as business formation files, financial records and proof of ownership. While the process is known to take time, the rewards can be immeasurable.

Business certification benefits

Once you become certified as a woman-owned small business, you may be able to benefit from the following programs.

SBA WOSB contracting program

The SBA maintains a federal contracting program designed to steer contracts toward certified WOSBs. The contracts reserved for the program are typically from industries where women-owned businesses are underrepresented, and the SBA’s leveling of the playing field helps position WOSBs to compete in the federal contracting arena more effectively. Some example industries include forestry, construction, civil engineering, industrial manufacturing and energy. Businesses can be certified directly by the SBA or through the WBENC.

WBENC or NWBOC benefits

When a business is certified by either WBENC or NWBOC, that enterprise can access the full range of benefits each organization offers. For instance, small businesses can display the logo of their certifying organization in a storefront or on marketing materials. WBENC and NWBOC also run conferences, seminars, training sessions, networking events and other opportunities, while engaging with corporate partners with whom their members then have established inroads.

Getting support as a women-owned small business doesn’t end with certification. You can also explore other opportunities for funding, such as loans and lines of credit. With the right business banking resources, financing, and contracting opportunities lined up, you can give your business the best chance to succeed.