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The Important Role of Women-Owned Businesses

ChallengeHER: Creating Procurement Access and Opportunity for Women

Shrinking the Contracting Gender Gap

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June 12, 2013
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This guest post by Rose Wang of Binary Group introduces some of the issues facing women-owned businesses in federal contracting.

This is a guest post by Rose Wang, Founder and CEO, Binary Group

The business owner landscape has changed dramatically over the last twenty years. Women are creating more businesses, employing more workers and generating more revenue than ever, as demonstrated by these statistics:

  • Women-owned businesses are growing. It is estimated there are over 8.6 million women-owned businesses in the United States The growth in the number, revenues and employment of women-owned firms over the past 16 years exceeds the growth rates of all but the very largest, publicly traded corporations in the country.1
  • Women are hiring more employees. When looking specifically at the 2007-2013 period, it is estimated the net increase of 5.3 million jobs economy-wide has come almost entirely from very large public corporations and women-owned firms.1
  • Women-owned firms continue to diversify into all industries. Women are starting more businesses in areas outside of education and other services, including technology, engineering, and health care.1
  • Women have a major impact on the economy. The economic impact of women-owned businesses in the United States is $3 trillion annually, as well as job creation or maintenance of more than 23 million jobs – 16% of all US jobs.2

Many of these women-owned businesses provide services, products and consulting to the Federal Government. The Federal Government established a 5% goal for procurement with women-owned small businesses (roughly at 3% now). In early 2013, a major improvement to the program was achieved. An amendment to the FY13 National Defense Authorization Act removed the dollar award caps on the women-owned small business (WOSB) set-aside program. With these policy changes and the current administration’s focus on creating new jobs and economic growth, one would think that agencies would be trying to meet or exceed the WOSB 5% goal.

Federal Government report card

Yet according to the National Women’s Business Council (NWBC), preliminary findings of a research project on the impacts of the newly implemented WOSB program3, women-owned small businesses are not getting their share of WOSB set-aside contract money. In fact, among the top five federal government agencies to use set-aside contract mechanisms (DoD, GSA, VA, DoJ, and DoI), WOSB set-aside contracts are at an average of 0.12% of the total set-aside contracts awarded since FY2011!

The Women-Owned Small Business (WOSB) procurement program was signed into law in 2000 and implemented by SBA in 2011. Why is this program so important? It’s all about job creation. By 2018, the Bureau of Labor Statistics projects that small businesses will create 9.7 million new jobs, with approximately 5 million to 5.5 million of those being created by women-owned businesses. This represents over half of the new jobs in the small business sector and one third of the total new jobs that will be created nationwide over the next eight years.4

In part two of this post, Rose will offer her solution for making sure that women-owned businesses get the work that has been set aside for them, so they can keep making these positive contributions to the U.S. economy. Stay tuned!

1 According to American Express OPEN’s 2013 State of Women-Owned Businesses Report: A Summary of Important Trends, 1997-2013.

2 The Center for Women’s Business Research 2009 Study.

3 The full NWBC report will be released in June 2013 with much greater detail about procurement practices across the Federal government.

4 The Guardian Life Small Business Research Institute 2010.

This post originally appeared on the Binary Group blog at http://www.binarygroup.com/blog/article/a_momentous_step_to_shrink_the_contracting_gender_gap, and was adapted and reprinted with permission.

Related posts:

  1. ChallengeHER: Creating Procurement Access and Opportunity for Women
  2. Federal Contracting and Subcontracting with Small Businesses – Issues in the 112th Congress
  3. Impact of SBA Size Standard Changes on Small IT Businesses
  4. How Section 1611 Will Level the Playing Field for Advanced Small Businesses
  5. What the MTA is Doing for Mid-Tier Businesses
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The All-Small Mentor-Protégé Program

SBA had a well-established mentor-protégé program (MPP) for SBA 8(a) certified firms but lacked an MPP program for other small business concerns and specifically, one for specialized certified concerns such as WOSB, EDWOSB, SDVOSB, & HubZone. The 2010 Jobs Act and 2013 NDAA gave SBA the authorization to address this by establishing an all-encompassing mentor-protégé program. Ms. Sandi Clifford, deputy director of the All Small Mentor-Protégé Program (ASMPP), visited the Mid-Tier Advocacy (MTA) earlier this year to discuss the program. Here are some of the highlights of this candid and informative discussion: As Ms. Clifford explained, mentor services to protégés include: • Management and technical assistance (internal business management systems) • Financial assistance (in the form of equity investments and/or loans) • Contracting assistance (contracting processes, capabilities acquisitions and performance) • International trade education (learn how to export, international trade business plan, finding markets) • Business development assistance (strategy, finding contracting and partnership opportunities) • General and/or administrative assistance (business processes and support) As administrators of the program, SBA provides: • Central HQ as opposed to 8(a) distributive model • Online application – certify.sba.gov • Online course tutorial requirement • Annual review and evaluation • Template agreements, i.e., MPA (Mentor-Protégé Agreement) Other All-Small Mentor-Protégé Program (ASMPP) details: • A protégé may generally only have one mentor at a time; SBA may approve a second (two is the maximum) where no competition exists, or if the protégé registers under a new NAICS or otherwise requires new mentor skills.  • Both protégé and mentor must be for-profit (with exception of protégé being an agriculture cooperative). • A mentor may have no more than three protégés at same time (no lifetime limit). • A participant can be both a protégé and mentor at the same time, if there is no competition or conflict. • The ASMPP is self-certifying and is open to businesses who qualify as small in their primary NAICS code, or who are seeking business development assistance in a secondary NAICs where they also qualify as small.  • SBA will not authorize MPAs in second NAICS in which firm has never performed any work; or where firm would only bring “small” status to Mentor and nothing else. • Existing 8(a) firms in last 6 months of the 8(a) program may transfer their MPA to the ASMPP via the online application process. Coordinate with 8(a) office to fine tune the process but there is no reapplication required. • Application requirements include upload of business plan, but no financial statements or tax returns. • JV agreements: ASMPP will not review and approve joint venture agreements. How to apply for the ASMPP: • Applicants are required to register in the System for Award Management (SAM) prior to submitting their mentor/protégé application. • Complete your business profile in certify.SBA.gov. • Evaluate and select your mentor prior to applying. This is not a matching program. SBA will not find a mentor for you. • Begin the ASMPP application process. • Protégés and mentors must complete the online tutorial and have their certificate of completion and all other required documents ready for upload Thank you to Sandi Clifford, Deputy Director, All Small Mentor-Protégé Program, for this helpful overview. TAPE has mentored several small businesses over it’s life as a large business (we’re large in some NAICS codes, though still small in others) and it has been gratifying, satisfying, and integral to our success. As protégés ourselves, we have benefitted from working with some really classy large businesses, and have also had the experience of being a protégé and really getting no tangible benefits. We are currently working with two small businesses, and negotiating ASMPP agreements. You can learn more about the ASMPP on the SBA site. To join MTA and attend future events like this one, please visit www.midtier.org.
Bill Jaffe
August 23, 2017
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