Benefits of Minority-Owned Business Certification
Business support: Corporations in the USA realize the excellent purchasing power of U.S. minorities. They want minorities to buy their services and products, and in return, they support their businesses.
Sustainable economic growth: Federal officials believe that minority-based businesses help to develop a sustainable economy in the country. The benefit of having a minority-owned business certification is that you can win federal contracts.
Some other benefits are:
- Access to government grants and contracts
- Enhanced business partnership opportunities
- Technical, training, and management guidance
- Networking opportunities
Please continue reading to learn how to get minority-owned business certification and how it helps to get more contracts.
NMSDC Certification
If you are planning to get your business certified, firstly, you need to know about the National Minority Supplier Development Council. It is the most prominent and significant certification body for minority-owned companies. The mission of NMSDC is “to serve as a growth engine for NMSDC-certified minority businesses and enable our members to advance economic equity.” It aims to assist Black, Asian, Native American, and Hispanic suppliers across the global corporate supply chain.
Founded in 1972, NMSDC has a backbone of 23 regional affiliated nationwide. It has a network of 15000+ certified minority-owned businesses. The council ensures to connect these business entities with 1500+ giant corporate members.
A few names of these giant corporate members of NMSDC are – Apple, Accenture, Delta Airlines, Google, Facebook, IBM, Nike, Microsoft, Walt Disney Company, Bank of America, UnitedHealth Group, and many more. These companies provide direct contracts to minority-owned businesses as certified by NMSDC.
Eligibility Criteria
Are you ready to get an NMSDC certification for your owned minority business? Follow the steps below to know the certification process in detail:
Below are some of the eligibility criteria for getting minority-owned business certification. Before starting, an entity needs to meet the business criteria whether it is eligible for the certification or not:
- The business owner must be a U.S. citizen or permanent resident.
- Business must be located in the U.S.
- Business must be operated and controlled by 51% minority-owned shares.
Documents Required
The next step required preparing all the documents. Below are the documents necessary to meet the eligibility criteria.
- Articles of incorporation
- Certificate of incorporation
- Stock certificates
- Bylaws (executed and attested)
- Stock ledger
- Amendments (if applicable)
Application Process
Cost of Certification
It is around $350-$1,200, depending on the region and where you apply.
Documents Upload: Upload all documents required and submit the application.
Schedule the Date: Now, the owner needs to schedule a site visit and interview performed by the certification specialist of NMSDC.
This certification process usually takes up to 90 days to complete. After receiving all the application materials, NMSDC Certification Committed reviews them. The application moves to the NMSDC Board for final approval when the committee approves it. In case of a rejection, the minority business can again submit an appeal letter addressing the concerns.
Federal and Local Minority-Owned Business Certification
Apart from NMSDC certification, you can also look for certifications from organizations like Small Business Administration (SBA) or other states and cities where your business is located.
The SBA offers 8(a) certifications for minority businesses. 8(a) certifications make minority businesses eligible for federal contracts set aside for such businesses. The federal government aims to offer at least 5 percent of contracts for businesses with 8(a) certifications. As per federal regulations, all companies with 51% minority ownership are eligible for 8(a).
Eligibility Criteria
Below are the eligibility criteria for 8(a):
- The individual applying for the certificate must be an American citizen or green card holder.
- The business must be a minority-owned small business
Note: There are different eligibility requirements for businesses owned by Native Alaskans, American Indians, Native Hawaiians, or Certified Development Companies.
Documents Required
Below is the list of necessary documents for applying for 8(a):
- Business tax returns for the past three years
- Personal tax returns for the past three years
- Financial statements of the business for the past three years
- Balance sheet including profit and loss statements of the business for the past three years
- Bank agreements, including statement or signature card
- Lease agreements
- Documented proof of contributions, transfer of assets for the past two years
- Incorporation documents, including articles of incorporation and certificate of incorporation
- DBA filings
- Meeting minutes
- Bylaws
- Stock ledgers and certificates
Certification Process
- View the SBA online course.
- Prepare all copies of government documents
- Get a free D-U-N-S number
- Get a user ID for SBA General Login System
- Start the online application for free
Apply on CocolevioCertify
- Fill in the required information about the organization and its owners.
- Upload the required documents as requested.
- Complete the payment in-app to submit the application which is just 99$.
- Your application and documentation are reviewed & verified. You will be notified of any questions or corrections needed.
- Applications get information about the certification decision via email or in-app notification.
