POSTED: 1:30 a.m. HST, Apr 24, 2011
Question: Why should I seek certification as a minority-owned or woman-owned business?
Answer: I would highly recommend that (eligible businesses) look at the federal contracting opportunities. Don't worry about the paperwork, just look at the opportunities. I check federal contracts every day. Roughly 25 percent of the contracts go to 8a (minority- or women-owned) firms; the rest are MBE (Minority Business Enterprises), WBE (Women Business Enterprises), disadvantaged small businesses or businesses in a hub zone. There are all kinds of categories, but many of them are open, anyone can apply, there's no set-aside (quota for certified businesses). People tend to think you have to be an 8a firm to get federal contracts or that you have got to be a huge firm … but Disney said “our smallest vendor does $68,000 a year in annual sales.” That's tiny, but that company is a Disney vendor.
We have companies that self-eliminate. They prequalify themselves out of the process without ever checking to see if they could qualify, and that’s where you get that 99 percent of small businesses that don’t apply. To me, here in Hawaii … there are so many specialized, talented businesses that could be providing services to the federal government, but we don't even apply.
Q: If a business doesn’t have a two-year track record to qualify for an 8a certification, what other types are available?
A: The easiest certification to get is an MBE, a Minority Business Enterprise. You can be male or female, which, to me, our Hawaii businesses should be knocking that door down. WBE certification is for any 51 percent or better, woman- or women-owned business. Additionally, we just qualified (a client) for her Woman-Owned Small Business program certification, which just started in April. Those contracts are going to be let in July through September. That’s totally new and is a federal government attempt to help women-owned small businesses.
If you get certified here, it’s good everywhere in the U.S. and Puerto Rico, and you can apply for (federal) contracts anywhere. For example, Hilton and Walt Disney have federal contracts, so government employees can ask for a government rate (for accommodations). So then that means they have to have a 23 percent set-aside for minority- and women-owned businesses among their vendors and suppliers.
If a crafter wants to sell items to Walt Disney in Ko Olina, if they’re not an MBE (or WBE), they would, for Disney's purposes, apply along with 77 percent of potential vendors, which is everybody else. That's a bigger market, more competitors and larger competitors. But if you're a MBE or WBE, then you’re in that 23 percent, which would tend to have less competition and smaller competitors.
There are federal contracts, just for women, in 83 different industries where women have either been underrepresented, as in construction, or substantially underrepresented, which is like, everything else. Contracts include catering, photography, printing business, construction, the travel business (and more).
Q: How much work and expense is involved in getting certified?
A: The MBE application fee is $350. There's an online application, and then there's a list of documents, 15 to 20, that you have to send in hard copy. On the WBE they have no standard fee; it’s based on the gross income of the company — a sliding scale.
The linchpin in the process, before it goes to the board to get approved is, they have to come here (for a site visit).
Hopefuls can be concerned if their business is home-based, that it might be viewed as not being a business, but if you're doing everything else and just operating out of home, that's fine. Show 'em the records. They just want to see that you are what you say you are. They wouldn't come all this way to try and disqualify you.