In the same way that individuals can earn certifications to open doors, so too can your small business. You may not even be aware of a certification your business may qualify for, or what benefits can be gained from obtaining certifications. The Small Business Administration (SBA) offers a variety of certifications that companies can pursue; if you want to know how your business can benefit, read below for four standard small business certifications and what they can offer you.
What Are Small Business Certifications?
A small business certification is an official document for which eligible enterprises can apply. Applying can lead to benefits like increased recognition, limited competition, preferential treatment, set-aside contracts, and increased revenue. Essentially, a small business certification is a step that encourages business growth.
The SBA certification is part of a contracting program that helps small businesses compete for federal contracts. The government sets aside some of its contracts for small businesses each year, so some contracts are guaranteed to go to small businesses rather than only to large corporations.
8(a) Business Development
This small business certification is for small companies owned by economically and socially disadvantaged individuals. According to the SBA, disadvantages include discrimination due to race, ethnicity, gender, or physical disability, or individuals who have impaired capital or credit opportunities. This certification is only given to a business once and is good for nine years.
The federal government allocates 5% of its contracting dollars to small, disadvantaged businesses every year. Businesses with this certification may be able to receive set-aside contracts. Companies who qualify for the 8(a) certification may also get access to management and technical assistance, and they are assigned a specialist who helps with business growth.
HUBZone Small Business
This small business certification is another SBA contracting program and is for businesses that are based in historically underutilized business zones. If you receive this certification, you can recertify every three years and can renew indefinitely if you continue to qualify.
The government allocates about 3% of its contracting dollars to HUBZone businesses each year, and these businesses may be able to receive set-aside contracts. Businesses receive a 10% price evaluation preference in full and open contract competitions, and this business gets preferential consideration.
Women-Owned Small Business
This business certification is for women entrepreneurs and lasts one year.
The government allocates 5% of its contracting dollars to Women-Owned small businesses each year, and these businesses could be able to receive set-aside contracts.
Service-Disabled Veteran-Owned Small Business
This certification is eligible for veteran entrepreneurs with a service-related disability.
The government allocates 3% of its yearly contracting dollars to these small business certifications each year, and the Service-Disabled Veteran-Owned Small Businesses could compete for set-aside contracts.
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