PARTNER POST: Differentiate Industrial Business from the Competition with Diversity Certifications
By Lindsay Gilder, associate editor at Thomas Insights
While certifications aren't a necessity for industrial businesses, they effectively illustrate the differentiators that distinguish you from your competition, reinforce your legitimacy for prospective customers looking to do business with you, and highlight your unique assets as a company.
If your business meets the required qualifications, a certification can offer your business a substantial edge over the competition, along with providing customers the benefit of knowing they're supporting a minority or small business.
As you finish outlining your 2020 strategic plans for your business, there's no better time than the beginning of a new decade to set your business apart by applying for industrial business diversity certifications.
What Kind of Diversity Certifications Does My Business Qualify For?
Industrial businesses are eligible for a variety of diversity certifications, including:
3. Minority Ownership
4. Small & Disadvantaged Business (SDB)
Last June, Fortune 500 recorded a record-breaking number of female CEOs on the Fortune 500 list – 33 females leaders ran Fortune 500 businesses. While this is an exciting achievement for women, it's still important to note that only a mere 6.6% of all CEOs are women.
With this in mind, securing a woman-owned business certification for your industrial business is even more important – and makes an even bigger impact on your business.
To qualify for this certification, your business must be at least 51% owned, controlled, operated, and managed by a woman or women. The certification also requires that a woman must hold the highest position in the company, be active in daily management, and be a U.S. citizen. It's recommended that the business be active for at least six months before applying for this certification.
Most federal, local, and state governments allocate a percentage of contracts specifically to women-business enterprises (WBEs). Once your business is certified, it's automatically added to The National Women Business Owners Corporation's database, where buyers can find your business and connect with you to source future projects.
Veteran-owned businesses actually have the opportunity to double-dip on certifications; there are certifications for both a veteran-owned business and a veteran-owned small business.
To qualify for either certification, a business must be at least 51% owned, operated, and controlled by a veteran. To prove veteran status, you'll need to submit a Department of Defense Form 214 (DD 214), which is issued to veterans upon retirement, separation, or discharge from active military duty.
Veteran-owned-certified businesses receive a major priority on federal government contracts and subcontracts: the federal government is required to award 23% of all contracts to small businesses, and veteran-owned businesses are given access to an additional 3% of contracts. While this may seem small, it can equate to billions annually.
This certification covers a broad range of minorities, from AbilityOne, which helps people with significant physical disabilities find employment opportunities, to Native American or African American-owned businesses. To qualify for minority-owned business enterprise (MBE) certifications, your business needs to be majority-owned by the minority certification for which you’re applying.
Small & Disadvantaged Business (SDB)
This certification is very similar to minority ownership in that it requires a qualifying business to be at least 51% minority-owned, but in this context, minorities are socially or economically disadvantaged business owners. To qualify for this certification, individuals must demonstrate that their business has a net worth of less than $750,000 and show "preponderance of the evidence" illustrating that their business is disadvantaged.
Businesses with the SDB certification are eligible for unique benefits under new federal procurement relations, namely "price evaluation adjustment," which means that disadvantaged small businesses don't necessarily need to be the lowest bidders in order to win a contract.
How Do I Apply for a Women-owned Business Certification?
Businesses can choose which level of certification they'd like to pursue, selecting from national, city, or state-level options. The first step of the application process for a women-owned business certification is to ensure your business is qualified, which can be determined either independently or through a third-party. Both methods require you going to the U.S. Small Business Administration’s (SBA) website to create and/or update your business' certification information. Even after your business gets certified, you'll need to log on once a year to maintain your status.
If you're planning to use a third-party for your certification, you'll have to contact your organization of choice. (SBA has a list of eligible organizations on their site.) Women in Manufacturing is also a helpful resource for women-owned small businesses to utilize for helpful resources through the certification process.
After submitting your documents through either a third-party or the SBA, the certification agency will likely conduct an in-person interview where they'll observe a normal business day at your company. Assuming this goes well and the certification agency can verify that your business is in fact run by a woman or multiple women, your documents along with a report of the visit will be sent to a committee for review.
According to Inc., the National Women Business Owners Corporation conducts the final review; the group has only had reason to deny one business certification in its history.
How Can Customers See That My Industrial Business is Diversity Certified?
After your business is certified, your new diversity certification will be publicly available for customers to view. Post a copy on your website for customers to download for reference and include it on your “about” page to ensure even new site visitors see it.
In addition to posting your certification on your own website, make sure to also update your profiles on other websites where prospects and customers can learn about your business. Your company listing on Thomasnet.com, for example, is a good place to start.
On Thomasnet.com, procurement professionals have the option to refine their supplier searches by diversity certifications; by including your diversity certifications in your company profile, you ensure your industrial business appears in search results and increase your opportunities for new business.