The journey to recognition as a Woman Owned Small Business (WOSB) can seem daunting. The complexities of the process can easily overwhelm without the right guidance and resources. Premier Certification Services, Inc. simplifies the journey, breaking down the steps into a comprehensive yet easy-to-follow WOSB Certification Checklist. Founded and managed by women, for women, we're proud of our 99% success rate in helping hundreds of businesses, like yours, attain certifications including WBE, MBE, DBE, or VBE, and WOSB, at both national and state levels.
Our seasoned team strives to simplify the certification process for you, saving you valuable time and resources while maximizing your prospects of attaining the much-coveted certifications. This uninterrupted successful streak verifies our proficiency with the WOSB Certification Checklist and the overall procedure – bringing businesses closer to their certification goal.
Small Business Size Standards
Identifying as a small business is a vital first step to earning the WOSB certification. It's necessary to meet specific qualifications defined by the Small Business Administration (SBA). SBA measures a 'small business' based on the average number of employees, income, or assets during the past 12 months. Typically, businesses involved in the retail and service industries are seen as small businesses if they generate up to $7.5 million in average annual receipts.
Breaking down the standards into simpler terms can make the understanding smoother. For manufacturers, up to 500 employees indicate a small business classification. In contrast, for wholesalers, the criteria are up to 100 employees. For some other industries, the annual receipts criterion may extend up to $35.5 million.
Moving on to the 'Employee-based size standards,' the ratio of full-time, part-time, or temporary employees informs the size of a business. This standard uses the average number of employees per pay period for the preceding 12 calendar months and counts all employed people, including those on paid leave.
On the other hand, 'Receipt-based size standards' use average annual receipts over three years. The term 'receipts' refers to income the business received from any source. It's not only limited to sales income. It's essential to remember that receipts are considered total income plus the cost of goods sold.
Primary NAICS Code Eligibility
Getting admitted to the WOSB certification process requires your business to fall under a specific NAICS (North American Industry Classification System) code. This primary NAICS code reflects the principal purpose of your business. The business's code must appear on the SBA's list of 'qualified industries,' published annually.
How do businesses determine their primary NAICS Code? It's the code that generates the highest revenue for the company. However, for newly created businesses with no financial history, the code indicates the projected highest income. Restricting the business's main scope to a single tag might take a lot of work. However, taking the time to correctly identify this can help significantly speed up the process.
For the NAICS code to be eligible, at least 51 percent of the business need to be categorically and directly owned by women who are U.S. citizens. The women owners must manage the operations on a day-to-day basis and make long-term decisions for the business. The woman holding the highest position in the company should work full-time during regular working hours, proving she's dedicated to the business.
Personal Net Worth Limitation
Personal net worth limitation plays a significant part in the WOSB certification process. As of July 15, 2020, SBA set the economic disadvantage criteria for personal net worth at $750,000. This value does not include equity in a primary personal residence or the business seeking certification.
How do you calculate the 'net' value? Add your assets (cash, retirement accounts, real estate investments, etc.) and subtract liabilities (loans, mortgages, etc.). Be accurate in your calculation, as an excessive net worth can inhibit your WOSB certification. An absolute understanding of the limitations can help you proceed with the application without hindrances.
Full-time Day-to-Day Management
The day-to-day operations of the business must be managed by one or more women, which is one of the primary requirements for WOSB certification. This means that women business owners can do only some of the tasks. However, the requirement ensures that women are making the key decisions and setting the strategic direction.
The day-to-day management speaks to the active, full-time, and hands-on approach women must have in company operations. The requirement also states that a woman must hold the highest officer position in the business and work at the business during all normal working hours.
Proof of Economic Disadvantage
It is not enough to be a woman-owned small business. The company must also prove the economic disadvantage condition for WOSB eligibility. The self-certifying woman must demonstrate that she is economically disadvantaged. This is evident in factors such as income, personal net worth, and the total fair market value of all assets.
The SBA outlines stringent guidelines about proving economic disadvantage. In terms of income, as mentioned earlier, the average three-year AGI should be $350,000 or less. For personal net worth, the women must have a personal net worth of less than $750,000, excluding the primary residence's equity and the business's ownership interest value.
Let's Start Your WBE, MBE, DBE, or VBE Certification Journey Together
Is your business poised to uphold the benefits of WBE, MBE, DBE, or VBE Certification? Ignite your journey towards certification with Premier Certification Services, Inc. Breathe new life into your self-certification efforts as we guide you through Our Certification Services. Our experienced team is ready to champion your cause, preparing you for the complexities of the certification pro
