If you own a business, you’re undoubtedly always looking for ways to increase its growth. Fortunately for female business owners, the Woman-Owned Small Business (WOSB) and Economically Disadvantaged Woman-Owned Small Business (EDWOSB) certifications give you access to resources and government contracts that can help you stimulate your company’s growth.
What Is the Woman-Owned Small Business (WOSB) Certification?
The WOSB certification is a program coordinated by the Small Business Administration (SBA) that was created to provide a level playing field for women business owners. Among other benefits, it allows certified businesses the opportunity to compete for WOSB Federal Contracting Program set-aside contracts within eligible industries.
The Economically Disadvantaged Woman-Owned Small Business (EDWOSB) certification is a subset of the WOSB program.
Advantages of Certification
Over 20 years ago, the federal government set a goal for awarding 5 percent of government contracts to small businesses owned by women. That goal has been elusive, but was finally met in 2015 when 5.05 percent, or $17.8 billion, of all federal contracting dollars that were eligible for small businesses were awarded to WOSBs.
In addition to the contracting goal, federal contracts can be “set aside” for WOSBs in industries where WOSBs are underrepresented. This helps ensure that small businesses owned by women are competing on a more level playing field with other similar companies.
The federal government uses the North American Industry Classification System (NAICS) to classify businesses by industry type. Further, the SBA maintains a list of NAICS Industry groups eligible for WOSB and EDWOSB. These are industries where women-owned businesses are often underrepresented.
Requirements for Certification
To qualify as a women-owned small business, or WOSB, your business must meet the following requirements:
- Your company must qualify as a small business based on SBA small business size standards. The standards are usually stated in terms of employee size and/or annual revenue, and vary depending on your industry code.
- Your company must be 51 percent owned by women who are U.S. citizens.
- Women must manage the operations on a daily basis and make long-term decisions for the company.
To qualify as an economically disadvantaged women-owned small business, or EDWOSB, your business must meet the WOSB requirements, and the owner of the company must demonstrate economic disadvantage in the following ways:
- Personal net worth is less than $750,000 with some exclusions (does not include official retirement accounts)
- Adjusted gross income averaged over three years of $350,000 or less with some exclusions
- Fair market value of all assets of $6 million or less
How to Get Certified
There are two primary ways to become certified.
1. Complete Certification at SBA.gov
You can use the SBA’s new, free online certification process for WOSBs and EDWOSBs at beta.certify.sba.gov.
In addition, the SBA currently allows participation from firms certified by the U.S. Department of Veterans Affairs Center for Verification and Evaluations (CVE) and 8(a) Business Development Certification Program, provided they meet all eligibility requirements.
To register, you will need an EIN, MPIN and DUNS number. You can get an EIN from the IRS, an MPIN is a code you’ll create when you register at SAM.gov, and a DUNS number is a free identifying number from Dun & Bradstreet. (Visit the D&B website or sign up for a free Nav account for to check if your business has a DUNS number, and if not, to request one for free.)
While the self-certification process has been eliminated for contracts set-aside under the WOSB program, that change isn’t currently effective. Businesses that previously self-certified may retrieve their documentation from Certify.sba.gov through March 31, 2021.
Currently, the SBA has approved four organizations as “TPCs,” or third-party certifiers:
- El Paso Hispanic Chamber of Commerce
- National Women Business Owners Corporation
- U.S. Women’s Chamber of Commerce
- Women’s Business Enterprise National Council (WBENC)
TPCs charge a fee to provide certification and annual recertification that currently ranges from approximately $200 to $400.
Once you are a certified WOSB, you can search for federal contracting set-asides for women-owned businesses. Additionally, you may have the opportunity to qualify for grants specified for women owned businesses. (Learn more about business loans for women here.)
A WOSB certification can help make it easier for you to grow your business. As an entrepreneur wearing a dozen different hats, anything that “makes it easier” to obtain one of your business goals is worth considering incorporating into your business plan.