Entrepreneurs are always looking for a competitive edge.
To thrive in a crowded marketplace, small businesses (SMBs) simply need to be the best. While superior products and pricing lay a great foundation, entrepreneurs often need more to stand out.
That’s where business certifications can help—especially for immigrant entrepreneurs.
By unlocking new relationships, financing opportunities, and customer credibility, business certifications can grow immigrant companies in powerful new ways.
Read on for an overview of business certifications, and a guide on how you can obtain them.
An Overview of Business Certifications
Every year, the U.S. government spends over $630 billion on goods and services.
That makes them the world’s largest consumer.
Within that sprawling budget, the federal government reserves a percentage of contracts for minority-owned businesses. Several private-sector organizations also share in this commitment.
To access these valuable contracts, SMBs must obtain business certifications.
And what are business certifications? In short, they are official documents that declare a business’ eligibility to compete for exclusive federal and private contracts.
To obtain federal certifications, SMBs must meet specific eligibility requirements.
For example, companies interested in the Minority Business Enterprises (MBE) certification must be 51% minority-owned.
Or, to qualify for the 8(a) Business Development Program, companies must also be 51% minority-owned and have a total market value under $4 million.
Though specific requirements vary, most certifications share the same focus of helping immigrant-owned businesses scale their operations and maximize their potential.
The Benefits of Business Certifications
Seeking a competitive advantage for your SMB?
Look no further than business certifications. As you’ll see, they can provide immigrant entrepreneurs with five major benefits, including:
1. Increased Revenue
Per U.S. law, the government must award 23% of its annual contracts to small businesses.
Within that number, 5% of all contracts are reserved solely for minority-owned companies.
What does that mean for you?
Business certifications like the 8(a) Business Development Program make approximately $25 billion available to immigrant entrepreneurs every single year.
Imagine what your company could accomplish with a cash injection from a federal (or private-sector) contract.
While manufacturing firms can receive up to $6.5 million in 8a contracts, businesses that sell goods and services have a funding ceiling of $4 million.
2. Limited Business Competition
The vast majority of businesses do not qualify for business certifications.
In fact, though there are over 33 million small businesses in the United States, less than 10,000 have their 8(a) certification.
Business certifications dramatically reduce the competition and allow your company to stand out.
After all, only certified companies can win federal contracts.
3. Joint Ventures
Some certifications allow you to form joint ventures to increase your chances of winning a contract.
In other words, you can team up with similar businesses to pursue the same contract.
While the Small Business Administration rules on partnerships are strict, joint ventures provide a great path to secure funding (while further limiting the competition).
Even if you don’t form official alliances right away, many certifications facilitate ongoing networking events with other businesses. Over time, these meetings and workshops can inspire new business ventures and strategic partnerships.
4. Business Mentorship
In addition to the financial benefits, business certifications can also connect your company with specialized mentorship programs.
For example, the Small Business Association (SBA) leads a Mentor-Protégé program that provides guidance on everything from business accounting and marketing, to contract bidding, to acquisition, and more.
The 8(a) Business Development Program also delivers one-on-one business development assistance and free training from the SBA’s Management and Technical Assistance Program.
5. Enhanced Reputation
Beyond the internal benefits, business certification can also boost your reputation in the public square.
After all, people trust businesses that demonstrate a standard of excellence. In fact, 81% of consumers need to trust a company before they buy from them.
As customers learn of your certifications (and your commitment to business development), your credibility will increase.
Who knows? Your new business certifications could make the difference between customers choosing your company over a competitor down the street.
Navigating the Certification Process (A General Overview)
The benefits of business certification are undeniably compelling.
But how does the actual certification process work?
Though each credential has its own requirements, here are five ground rules to help you get started:
1. Know Your Options
There are three main issuers of business certifications:
- The U.S. Small Business Administration (SBA).
- Minority-centered organizations (like the National Minority Supplier Development Council NMSDC).
- Local organizations (like Chicago’s Minority and Women-Owned Business Certification Program).
You can easily find your state office of minority and women business owners.
While private and local providers are worth considering, federal business certifications will typically provide access to the most capital.
2. Review Eligibility Requirements
Most certifications are reserved for businesses with at least 51% minority ownership.
Applicants must also have a personal net-worth under $850,000 and total assets of $6.5 million or less.
According to The Small Business Act and NMSDC, minority owned groups include Hispanic Americans, Asian Pacific Americans, African-Americans, Native Americans, and Subcontinent Asian Americans.
3. Register Your Business
Some certifications, like the 8(a) Business Development program and the Small Disadvantaged Business (SDB), will require you to officially register your company.
This form can be accessed through the System for Award Management (SAM).
4. Anticipate a 90-Day Application Process
After you submit your application, you can generally expect to receive a response within three months.
If you need to expedite the process, you can hire consulting firms like Advance 8(a) and The 8(a) Authority to reduce application times.
While most SBA certifications are free of cost, some minority-centered non-profits may charge an application and certification fee.
5. Gather Supporting Documents
Be prepared to provide essential financial documents like your profit and loss statement, bank statement, Dun & Bradstreet (DUNS) number, and tax returns.
Some certifications are more demanding than others.
For example, the SBA requires a detailed narrative about hardships and disadvantages you’ve encountered on your small business journey.
Others, including the MBE certification (offered by the NMSDC), will require on-site visits from specialists as part of your application.
Once again, these are general guidelines to reveal the landscape of business certifications.
Your own research and investigation will reveal the exact timing, cost, and application requirements of each certification.
7 Business Certifications to Consider
Throughout this article, we have mentioned a range of business certifications for you to consider.
In the list below, we have consolidated them for your review.
Though there are many worthwhile local certifications, the following list prioritizes the most popular national certification programs that entrepreneurs pursue:
- 8(a) Business Development Program, which provides minority-owned businesses with federal benefits over a nine-year term.
- HUBZone Program, which commits 3% of federal contracts to SMBs in “historically underutilized business zones.”
- Small Disadvantaged Business Certification (SDB), which is provided by the SBA and is available for minority-owned companies at social or economic disadvantage (Black Americans, Hispanic Americans, Subcontinent Asian Americans, and Asia Pacific Americans). To register, visit the System for Award Management (SAM)
- Women-Owned Small Business Program (WOSB), which receives 5% of federal contract dollars each year.
- National Minority Supplier Development Council (NMSDC), a non-profit organization that provides Minority Business Enterprises (MBE) certification for both the public and private sector.
- Disadvantaged Business Enterprise (DBE) Program, which the Department of Transportation (DOT) offers to minority-owned businesses. Per federal law, 10% of annual DOT funds must be spent with DBEs. To apply, complete this application and contact your state transportation agency for delivery information.
- 58Joralemon, an alternative certification provider that certifies women-owned and minority-owned businesses in as little as one week.
We wish you the best of luck with your applications.
While the certification process may take time, we encourage you to stay patient and trust that your efforts will reap lasting rewards.
uLink Business: Built for Small Business Owners
Entrepreneurs like you are special.
You’re innovative, inspired, and dedicated to bringing your business to life.
While entrepreneurship can be challenging, the certifications we discussed today can provide the capital you need to scale your business and expand your audience.
At uLink Business, we share a standard of excellence similar to your own. Our mission? To make international payments as seamless as possible.
Let’s build your business together.
