Women-owned businesses are eligible for certain opportunities and concessions with the IRS that are generally not available for other business owners. Small business set-asides are the federal contracts that are generally awarded to small businesses. These set-aside contracts are a great opportunity for small and new companies to break into the industry that major players already dominate.
What are small business set-aside contracts?
In order to limit the competition and to create a leveled playing field for small businesses. The government limits the competition for certain business contracts to small businesses and women-owned businesses. These contracts are called small business set-asides, and help the business compete and take over the federal contracts.
Impact of small business set aside contracts on women-owned businesses
The women-owned federal contracting program was originally created to improve the number of women-owned businesses and to bring in a lot of variation in these businesses. It is also seen as a clear strategy to break the historic inequality in the work opportunities for women. It is seen as an exceptional way for women to start playing a predominant role in the otherwise male-dominated industry. Some of these contracts are specifically reserved for economically disadvantaged women-owned businesses.
If the women-owned business becomes part of this federal set-aside program, they would become eligible to compete in federal contracts that are reserved mainly for certified professional companies. The women-owned businesses are WOSB would be able to take part and compete in these contracts given by the federal government. The eligibility requirements to qualify for these programs are as follows.
- The WOSB should be a small business and should comply with the size standards of the small business administration.
- The firm should be at least 51% owned and managed by women, and they should be US citizens.
- Women should manage the day-to-day business operations of the firm, and they should also be able to make long-term decisions in the company.
The economic disadvantage that these women-owned businesses enjoy should be aligned perfectly with the federal contract program given by WOSB. They should first apply for certification from the federal government to qualify for the federal set-asides. In order to maintain their WOSB certification, the small business should undergo program examination and evaluation conducted by the SBA every three years.
How can women-owned businesses get their small business set aside?
It is generally tough to compete for contracts with well-established and large enterprises. To give small businesses an opportunity to grow and sustain, the federal government offers them certain reservations in the federal contacts under the name of set-asides. These set-asides are actually good for everyone, as concentrating all the jobs with very few organizations suspends the creation of new jobs elsewhere.
In order to grab these contracts from the federal government, it is not just enough to be a women-owned small business. It is important to create a compelling bid with an appropriate price to get the contract. There will be many small businesses aiming for the same contract, and only the brightest one gets the bet. While quoting the price for the contract, it is important to present a bid that gets the best work done at a competitive price. It is important to leverage the unique techniques and technology that the company can offer. It is also important to deliver high-quality work within the budget and timeline.
Bottom Line
The federal government is trying to award at least 5% of all its federal contracts to women-owned small businesses every year. Apart from the business development opportunities that are available from the federal government, women-owned businesses can avail of some loans and grants as well.