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SBA Levels the Playing Field for Women-Owned Businesses

Getting their Share of Government Contacts

By , About.com Guide

Updated October 05, 2011

The U.S. government awards contracts for goods and services worth over $400 billion every year. Under a law passed by Congress in 2000, a full 5% of that $400 billion, or about $20 billion worth of those contracts, is supposed to go to woman-owned small businesses. However, the nation’s 684,000 woman-owned small businesses had been getting only about a 3.5% slice of the government contracting pie until the Small Business Administration (SBA) took a big step to level the federal contracting playing field.

The Problem

Woman-owned small businesses were not getting their full share of federal government contracts because the SBA had failed to create specific “small business set-aside” contract programs for them as they had for small disadvantaged businesses (the SBA 8(a) program), service-disabled veterans and historically underutilized business zones (SBA HUBZones).

Small business set-asides are federal regulations that require the federal agencies to award a certain percentage of their contracts for goods and services to specific types of small businesses, such as those owned by service-disabled veterans.

The Solution

It took 11 years, but in February 2011, the SBA implemented a final rule implementing the Woman-Owned Small Business Federal Contract Program (WOSB Program) to enforce the congressionally required 5% contract set-asides for women-owned small businesses. By April 2011, the federal agencies actually began awarding set-aside contracts under the WOSB program.

SBA administrator Karen Mills outlines the goals of the WOSB program in a press release stating, “Women-owned businesses are one of the fastest growing sectors of the economy. That’s why providing them with all the tools necessary to compete for and win federal contracts is so important. Federal contracts can provide women-owned small businesses with the oxygen they need to take their business to the next level.”

WOSB and Your Business

The SBA’s Women-Owned Small Business (WOSB) federal contract program authorizes the contracting officers of the federal agencies to set aside certain federal contracts for eligible and certified women-owned small businesses (WOSBs) or economically disadvantaged women-owned small businesses (EDWOSBs).

The contracting officers of the government agencies are authorized to award WOSB or EDWOSB set-aside contracts in any of the more than 300 industry categories (NAICS codes) in which women-owned or economically disadvantaged women-owned small businesses have been declared “underrepresented” or “substantially underrepresented.”

The price of WOSB or EWOSB set-aside contracts cannot exceed $6.5 million for manufacturing contracts and $4 million in the case of all other types of contracts.

WOSB Eligibility Basics

To be eligible for WOSB program contracts, a business must:
  • Be a small business that is at least 51% percent unconditionally and directly owned and controlled by one or more women who are citizens of the United States.
  • Have a woman manage the day-to-day operations, make long-term decisions for the business, hold the highest officer position in the business and work at the business full-time during normal working hours.
To be eligible for EDWOSB contracts, a business must:
  • Be a business that is eligible for the WOSB program and is at least 51% unconditionally and directly owned by one or more women who are “economically disadvantaged.”
  • Have an economically disadvantaged woman manage the business' day-to-day operations, make long-term decisions for the business, hold the highest officer position in the business and work at the business full-time during normal working hours. A woman is presumed economically disadvantaged if she has a personal net worth of less than $750,000 (with some exclusions), her adjusted gross yearly income averaged over the three years preceding the certification less than $350,000, and the fair market value of all her assets is less than $6 million.
Getting Help with the WOSB and EDWOSB Programs

The SBA has create several resources to help small business owners understand how to get involved in the WOSB and EDWOSB programs and win contracts under them. The best way to proceed is to contact your local SBA Office for personalized advice and training.

In addition, the SBA has created this handy guidebook (PDF) containing details on WOSB and EDWOSB program basics, eligibility requirements, federal contracting opportunities.

New to Government Contracting?

If you are new to the $400 billion a year government contracting industry, you might want to take a look at some of these resources:
  • SBA’s Government Contracting Guide
    Explains how to get started, what you’ll need to do business with the government and how to identify, create and pursue potential business opportunities.

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