It seems that many companies have SMWVDBE (Small, Minority, Women, Veteran, Disadvantaged Business Enterprise) certification on their minds as the new year begins. So, it makes sense to revisit what certification is all about and why a business might want to get certified.
What is a certification? SMWVDBE certifications are offered by the Small Business Adminstration, State Governments and various thrid party organizations (NMSDC, WBENC, etc.). These certifiers review information about the applicant company and make a determination as to whether the applicant business is legitimately owned, controlled and operated by indiviuals qualified by their particular certification program. The goal of these programs is to create a level playing field for diverse businesses in procurement processes. Government agencies and most corporate procurement activities now require diverse spending throughout their supply chain. In many cases, prime contractors are required to implement second tier sub-contractor programs to assist the end client, be it governmental or commercial in meeting the specified diversity spend goals.
Who qualifies to be certified? Each certifying body has its own requirements, but there are three or four universal items:
- The business be at least 51% owned by individuals meeting the certifier’s requirements, e.g. 51% minority or 51% women or 51% veterans, etc.
- The business be at least 51% controlled by individuals meeting the certifier’s requirements, e.g. 51% minority or 51% women or 51% veterans, etc.
- The business be at least 51% operated by individuals meeting the certifier’s requirements, e.g. 51% minority or 51% women or 51% veterans, etc.
- For disadvantaged certifications, that the owner’s personal net worth cannot exceed the maximum allowed by the certifying agency. Department of Transportation maximum is $1.32 million; Small Business Administration is between $250,000 and $750,000 depending upon your program year. You should always check with the certifying agency if you have concerns about net worth limits.
How long does it take? Nothing about getting certified is quick! The application process takes time and you’ll have to gather all of your organizational documents and attach them to the application. Once you submit the paperwork, it will take the certifier a significant amount of time to review your application and all the attachments. Once that initial review is completed, the certifier will likely conduct a site-visit, either in person or via conference call. You can always call and ask the certifier how long they think it might take, but it is likely to take at least 60 to 90 days from receipt of an application to award of a certification.
So why put yourself through the hassle? To gain recognition as a legitimate SMWVBE supplier of your goods and services, and:
- Access to set-aside contracts, those opportunities that are earmarked for SMWVDBE suppliers.
- Access to participation with prime contractors for SMWVBE portions of major contracts.
- Assist your clients in meeting their goals for SMWVBE spending. They can’t count you unless you are certified.
- Boost your marketing efforts through federal, state, local and commercial offices of supplier diversity.
As with most things in life, anything worth having requires an effort. There are great advantages to being SMWVDBE certified.