What it Means to Run a Woman-Owned Small Business

Posted 3 years ago by Max Komonov

Women-owned businesses are much more common today than they were 20 years ago, but a woman-owned small business still faces some unique challenges. Although centuries of gender discrimination are slowly but surely making way for a more equitable future, discrimination can still be a major concern for female business owners, particularly those in male-dominated industries.

But for many women, running a small business is very rewarding, and there are some unique perks. For example, as a part of reparations to female entrepreneurs, the federal government in the United States has instituted a Woman-Owned Small Business (WOSB) Federal Contracting Program to offer more opportunities to these women business owners and encourage their growth.

Overcoming Challenges as a Women Entrepreneur

Even though women are rising in the business world, how our society views women can create challenges for these business owners. Here are a few of the issues that almost all female business owners face and how you can hurdle over them.

Work/life balance

Even though women make up 47% of the workforce, they are still expected to run their households alone. A Gallup survey found that most career women are still responsible for laundry, cleaning, caring for children, grocery shopping, and other household tasks and errands.

In the midst of those demands, women who set their own hours are often taken advantage of by their family and friends because they have a flexible schedule. You must set clear boundaries in the beginning to avoid frustrations and missed deadlines later.

Gender discrimination

It is worth mentioning again that gender discrimination is still very much an issue in today’s business world. Women business owners make up less than 20% of all small businesses, and as such women often face difficulties networking with other business owners. Women in industries predominantly run by men run into even more problems and are rarely taken seriously.

Addressing a lack of confidence

One of the reasons there aren’t more women-owned small businesses is that women lack the confidence to forge ahead on their own. Women are told by society, their coworkers, their managers, and even their family that they don’t have what it takes to run their own business.

If you’re questioning your ability to run a successful small business, sit down and brainstorm all of your skills, talents, abilities, certifications, and experience that apply to your new venture. When you can see your qualifications in black and white, it gives you more confidence going forward.

Benefits of Being a WOSB

The benefits of being a woman-owned business range from targeted resources to unique promotional and contracting opportunities. The Small Business Administration does a credible job of offering resources to women and other business owners that have been discriminated against recently or in the past. Through much research and many surveys, organizations have figured out ways to help women-owned businesses succeed in spite of the challenges.

The Small Business Administration offers many resources for women-owned businesses, including the Office of Women’s Business Ownership, the voice of female business owners to the federal government. The National Women’s Business Council also has some excellent resources for women-owned small business planning and management. Both of these organizations have additional resources listed on their sites.

WOSB Federal Contracting Program

The Women-Owned Small Business Federal Contracting Program is designed to give WOSBs opportunities for federal contracts, which pay much more than the private sector in almost any industry. The federal government’s goal is to offer at least 5% of federal contracts to certified women-owned small businesses.

To meet that goal, the federal government designates certain contracts as for women-owned businesses exclusively. Federal contracts open to all small businesses will be limited to women if more than two WOSBs apply for the same contract. Small contracts in industries typically dominated by women are much more common than large federal contracts to women in male-dominated industries.

Qualifications for WOSB and EDWOSB Federal Contracting Programs

In order to qualify for these federal contracts, your company must be at least 51% women-owned with women managing day-to-day operations, and contracting officers must be women. It must meet the criteria to qualify as a small business, which is based on profits and company size and is determined by industry.

The SBA also offers additional opportunities to economically disadvantaged women-owned small businesses. The EDWOSB Federal Contracting Program offers additional bidding opportunities to those women who face additional challenges. In addition to the qualifications for WOSBs, owners of EDWOSBs also must be within a certain range of personal net worth and adjusted gross income.

Joint Venture Agreements

A joint venture is a partnership between two or more entities in which they work together for a common goal, in this case landing a federal contract. Each company has talents and areas of specialty to bring to the table, increasing the likelihood of winning the contract.

Small businesses often apply to government contracts as a part of a joint venture agreement because small companies have more limited specialties and may not be able to manage the project on their own. But there are some rules as to whether or not your joint venture can apply for WOSB federal contracts.

Both entities must qualify as a small business according to industry limits set by the SBA
A women-owned business must manage the venture, including day to day operations
A woman-owned business must take ultimate responsibility for the performance of the federal contract
When the joint venture creates a separate entity, it must be at least 51% women-owned

There are many other requirements for joint ventures when it comes to federal contracts. You can learn more about joint venture criteria from Cornell Law School here.

Women-Owned Small Business Certification

Before you can get the benefits of being a women-owned business, you have to certify. The certification allows you to apply for WOSB federal contracting opportunities and may give you benefits in the private sector as well. For example, Upwork offers benefits for certified women-owned businesses (and other minorities).

There are two types of certification, WOSB and EDWOSB.

The women-owned small business certification allows you to bid on government contracts designated for female small business owners. Of course, you will also be able to apply for other projects in the Small Business Federal Contracting Program.

The criteria for WOSB certification include:

Meet standards for company size and revenue, determined by industry at the SBA
Be at least 51% women-owned, and women must be responsible for major decisions and day-to-day operations.
The highest position in the company must be filled by a woman working full-time hours.

Some women-owned businesses may also qualify as an economically disadvantaged business. The EDWOSB program has a few more requirements, including a maximum personal net worth of $750,000 per year.

There are a few different ways that you can get certified. You can self-certify with supporting documentation like a birth certificate, tax return, and/or business financial report. The process can be complex, so you might consider third-party certification. You can learn more about WOSB and EDWOSB certification on the SBA website.

Although there are no requirements for time in business for small business federal contracts, you will be more likely to win projects if you have a well-established business. When you sell physical products, digital products, or services, you can use Ecwid to build your business as you build your profits, preparing you for government contracts in the future. To inspire you, here’re some successful women-owned online stores built with Ecwid.

About The Author

Max has been working in the ecommerce industry for the last six years helping brands to establish and level-up content marketing and SEO. Despite that, he has experience with entrepreneurship. He is a fiction writer in his free time.