Editor’s note: Each Tuesday, ‘Breaking Glass’, written by Jennifer Tilden, takes a look at issues confronting women and minority entrepreneurs. Certifications have become a common distinguishing element in today’s highly competitive business environment. They separate the pros from the amateurs in the fitness training industry. They increase the perception of expertise and allow higher billable rates for programmers and developers. And, they provide a means for women-owned businesses to expose themselves to a whole new market of potential clients and business partners.
Two national organizations, the Women’s Business Enterprise National Council (WBENC) and the National Women Business Owners Council (NWBOC) offer certification program to identify a company as an official “Women’s Business Enterprise” (WBE). The more prominent of the two organizations offering the programs is the WBENC, which celebrated its fifth anniversary last month. WBENC is managed by corporations seeking to find and to do business with WBEs. More than 400 Fortune 500 companies pay between $10,000 and $1100,000 per year to belong to WBENC, and they pursue businesses that have this particular certification only.
The purpose for certification is to identify a company as women-owned according to standardized criteria. The benefit is that many major corporations have initiatives and requirements in place to generate business with WBEs and the certification ensures that these targets are what they appear to be.
Criteria include that 51 percent of the business be women or women-owned and 51 percent of the daily operations must be managed by a woman or women. Who in the company makes hiring decisions, who has deal making authority and who authorizes checks and payroll factor into the definition as well. The certification itself consists of a series of forms to prove and document a company’s claims that it meets the criteria. Nearly all large companies with WBE initiatives will not even consider doing business with a firm that’s not officially certified. Once certified, a WBE is open to a whole new scope of business opportunities.
Why aren’t there more certifications?
According to recent data, there are close to 9.1 million women-owned businesses in the United Sates. Of that number, a mere 2,000 have been certified through the national programs.
Mary Cantando, local entrepreneur and founder of sales and marketing strategy development and consulting firm Cantando & Associates has been leading the charge in the RTP to encourage and help facilitate local WBEs into achieving certification. Her business clients are $2 million to $20 million in revenue women-owned businesses.
“I found that although most of my clients qualified to achieve certification, they didn’t pursue it,” Cantando tells Local Tech Wire. “First of all, they didn’t really understand the value of getting certified. Second, they may think it’s a great idea but they say they don’t have time to do it. The application process itself is a daunting task. ”
By “daunting”, Cantando refers to the paperwork and the time and details required to complete it. For example, WBENC certification consists of a 20-page application with 35 attachments. NWBOC certification consists of a 14-page application with 43 attachments. There is also an application fee and audit committee for each program.
“Many entrepreneurs are so focused working in their businesses they don’t make time to work on their businesses” says Cantando. “They’ve got their blinders on and are working full steam ahead. Something like this can easily be back-burnered or not seen as a priority. It’s complex and requires a significant time commitment and they may not see the potential return.”
As part of her business, Cantando provides advising and management of the certification process for interested clients. And the return can be very significant. According to Cantando, there are some staggering testimonials from recipients of the certification.
“I spoke to a business woman in the DC area who had recently received the certification. She was in her third year of business. She told me the first two years she got a few hundred thousand dollar contracts, but in her first year certified she closed a $6 million contract. “
A need to swallow pride?
Companies are not targeting WBEs out of the goodness of their hearts or as part of any kind of government or corporate mandate. They are targeting these businesses for reasons related to what Cantando calls the “five Cs”:
2. Contract awards
5. Common good
“I needed to convince my clients that this was not some kind of special dispensation for women” says Cantando. “They have this strong, ‘I can make it on my own’ mentality. By doing business with WBEs, these large companies develop new customers, gain PR opportunities, assist with local economic development, or meet their own contract incentives. I say, if you were in a card game and you had a trump card in your you’re deck, wouldn’t you play it?”
(For more information, contact Cantando via email (email@example.com).
Web site for Women’s Business Enterprise National Council: www.wbenc.org
Web site for National Women Business Owners Council: www.nwboc.org