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Spotlight on Diversity: Women- and minority-owned firms are finding that being certified as such can pay off in a big way

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Rebecca Moll Freed, left, partner, and Jisha V. Dymond, counsel, at Genova Burns 
Giantomasi Webster.
Rebecca Moll Freed, left, partner, and Jisha V. Dymond, counsel, at Genova Burns Giantomasi Webster. - ()

In the wake of economic decline, here's one surprise: government and corporate contract opportunities have improved.

And if you're a woman- or minority-owned business, being certified as such can go a long way toward boosting your chances of winning the job.

That's nothing new, but experts say that status is more critical than ever these days — as more companies seek the designation and the certification process becomes more stringent.

“Clients are starting to realize that being a minority- or women-owned business can increase their chances of successfully competing for contracts,” said Rebecca Moll Freed, partner at Genova Burns Giantomasi Webster in Newark.

Marsha Firestone, president of the Women Presidents' Educational Organization, founded her group in 1998 to increase access to business opportunities for women's business enterprises.

As a regional partner of the Women Business Enterprise National Council — now the largest third-party certifier, with more than 12,000 women business enterprises nationwide — Firestone said WPEO received 50 applications in its first year.

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Now it's close to 2,000, she said.

Jisha V. Dymond, counsel at Genova Burns, said being woman- or minority-owned “often ties into procurement and government contracting opportunities, whether it's to compete directly as a prime contractor or to be used a subcontractor.”

But it's easier said than done.

Proving that you are indeed a woman or minority business owner who owns at least 51 percent of your company has become much more popular — and therefore, much more difficult.

“There's a stringent certification process due to having been abused in the past,” Freed said, noting that, “for example, a family-owned business at one time may have made a stay-at-home wife or mother 51 percent owner in order to be eligible, despite not having interest in the business.”

But now that the state has made much more of a concerted effort to set aside contracts for minority- or women-owned businesses — with some local governments even including set-aside goals in their municipal codes — Freed's firm has been encouraging its clients to file all the paperwork required to become certified, even if they had not considered the possibility of competing.

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“Oftentimes an opportunity suddenly presents itself that seems perfect, and these minority- or women-owned businesses realize they never got a business registration certificate,” Freed said.

And even in situations involving “pretty substantial government contracts,” she said, a minority- or woman-owned business that wasn't qualified to be a prime contractor might still be attractive as a partner and subcontractor to a larger company.

Before delving into any complex certification processes, Freed asks that companies remain honest with themselves, encouraging business owners “to take a hard look at how their businesses are truly structured.

“Is the person or people who are being listed as minority or women owners performing key functions?” she said. “Are they the face, name or brand of the business?”

If a woman or minority business owner works full-time managing the day-to-day operations and long-term strategic decisions of the company, certification is a no-brainer.

Monica Smith, chairwoman and founder of Marketsmith Inc., completed her company's Women Business Enterprise certification in May with the state of New Jersey.

And she is looking into obtaining broader certifications in the future via third-party certifiers such as the Women Business Enterprise National Council — which has seen a 30 percent increase in certifications over the last five years.

For the successful direct response marketing firm in Parsippany, getting certified was anything but a waste of time.

“It narrows the playing field when bidding on projects and increases the odds of winning,” Smith said.

“It (also) introduces us to companies that we may not have had the opportunity to work with in the past.”

While the laborious certification process can usually take anywhere from four to eight weeks, Smith managed to receive Marketsmith Inc.'s certification within three weeks by simply making sure to “cross T's and dot I's.”

Though all applicable businesses should get certified, it's actually the startups that may have an easier time doing so.

The earlier a business wants to become certified, the less difficult it becomes to look through existing paperwork — and there is no minimum amount of time one must be in business before applying.

“The state is able to provide rewarding opportunities and benefits for stay-at-home mothers starting businesses from their laptops or women entrepreneurs right out of college,” Dymond said.

Therefore, one thing the state can improve is how they convey such opportunities to existing small business owners such as Niru Mallavaru.

As founder and CEO of MobileArq in Summit — a private, multiplatform online school network and directory — Mallavaru had never heard of such opportunities in the two years she's been in business.

“I'm more technology-based and not marketing-based, so I needed someone to wake me up and tell me about these things,” Mallavaru said.

“Business owners are sometimes so engrossed in developing their business that they're not even aware of the services available to them.”

But now that she's been made aware, Mallavaru agrees that it's better to be certified than sorry.

E-mail to: megf@njbiz.com
On Twitter: @megfry3

More than one option

The number of certifications a business can obtain is often cumbersome and overwhelming, said Firestone, president of the Women Presidents’ Educational Organization.

“It’s unfortunate that there are different certifications for each government agency and public entity and private sector,” Firestone said.

“It’s like having to have a different driver’s license for every county you drive through.”

Despite the pain of it all, a business should consider getting multiple certifications so as not to limit the type of work it can bid on.

“There are certain advertising elements and entire networks you’re able to tap into once you’re certified,” Dymond said.

Here are a few to consider:

  • The Women Business Enterprise (WBE) certification is gender-based for women-owned businesses. More specific in scope are the Small Business Association’s Women Owned Small Business (WOSB) and Economically Disadvantaged Women Owned Small Business (EDWOSB) federal contract programs. All can be obtained via third-party certifiers such as the Women Business Enterprise National Council (WBENC) or the National Women Business Owners Corporation (NWBOC).
  • The Small Business Association’s 8(a) Business Development program provides training workshops for minority-owned businesses and some access to government contracting opportunities, while the race-based Minority Business Enterprise (MBE) certification can be obtained via the National Minority Supplier Development Council.
  • A Small Business Enterprise (SBE) registration is required to compete for contracts under the Small Business Set Aside Act — 25 percent of state and purchase order dollars must be awarded to small businesses.

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