Becoming a Certified Business
While NDS is not a certifying entity, we have listed, below, some of the most prominent types of certifications, their requirements and links to their respective certifying organizations:
Minority-Owned Business or Minority Business Enterprise (MBE)
According to the National Minority Supplier Development Council (NMSDC), a Minority-Owned Business or Minority Business Enterprise (MBE) is a for-profit enterprise, regardless of size, physically located in the United States or its trust territories, which is 51% owned, operated and controlled by minority group members. In the case of a publicly-owned business, at least 51% of the stock is owned by one or more such individuals. Further, the management and daily operations are controlled by those minority group members.
A minority group member is defined by NMSDC as an individual who is a U.S. citizen with at least ¼ or 25% minimum (documentation to support claim of 25% required from applicant) of the following:
- Asian-Indian – A U.S. citizen whose origins are from India, Pakistan or Bangladesh.
- Asian-Pacific – A U.S. citizen whose origins are from Japan, China, Indonesia, Malaysia, Taiwan, Korea, Vietnam, Laos, Cambodia, the Philippines, Thailand, Samoa, Guam, the U.S. Trust Territories of the Pacific or the Northern Marianas.
- African American – A U.S. citizen having origins in any of the Black racial groups of Africa.
- Hispanic – A U.S. citizen of Hispanic heritage, from any of the Spanish-speaking areas of the following regions: Mexico, Central America, South America or the Caribbean Basin only.
- Native American – A person who is an American Indian, Eskimo, Aleut or Native Hawaiian, and regarded as such by the community of which the person claims to be a part.
- Certification is standardized and done at the local or regional level. The NMSDC and its regional affiliates charge a non-refundable application fee. Certification must be renewed annually and is accompanied by an annual fee.
Woman-Owned Business Enterprise (WBE)
According to the Women’s Business Enterprise National Council (WBENC), a Woman-Owned Business Enterprise (WBE) is an independent business concern that is at least 51% owned and controlled by one or more women who are U.S. citizens or Legal Resident Aliens; whose business formation and principal place of business are in the U.S. or its territories; and whose management and daily operation is controlled by a woman with industry expertise.
To become certified, women owned businesses complete a formal documentation and site visit process which is administered by one of WBENC’s Regional Partner Organizations. A non-refundable fee is charged. Certification must be renewed annually and is accompanied by an annual fee.
As defined by the Small Business Act, a small business concern is “one that is independently owned and operated and which is not dominant in its field of operation.” Depending on the industry, ‘small’ is defined by either the number of employees or average annual receipts of a business concern. The Small Business Administration has established size standards for all for-profit industries by NAICS code.
Small Business Administration 8(a) Program
SBA 8(a) businesses are owned and controlled by a socially and economically disadvantaged individual. Under the Small Business Act, certain presumed groups include African Americans, Hispanic Americans, Asian Pacific Americans, and Subcontinent Asian Americans. Other individuals can be admitted to the program if they show through a “preponderance of the evidence” that they are disadvantaged because of race, ethnicity, gender, physical handicap, or residence in an environment isolated from the mainstream of American society. There is also an economic disadvantage test for individuals. The SBA 8(a) program is managed by the Small Business Administration.
Disabled Business Enterprise (DSBE)
DIS are businesses that are at least 51% owned and controlled by a handicapped individual or service-disabled individual. A handicapped individual is a person who has a physical, mental, or emotional impairment, defect, ailment, disease, or disability of a permanent nature, which in any way limits the selection of any type of employment for which the person would otherwise be qualified.
Veteran-Owned Business Enterprise (VET)
VET businesses are a least 51% owned, and controlled by U.S. citizens who are Veterans of the U.S. Armed Forces. The Department of Veterans Affairs offers more information on qualifications.
Service-Disabled Veteran-Owned Business
A small business that is at least 51% owned, operated and controlled by one or more veterans with a service-connected disability. For more information on the policy, see the Social Security Administration’s webpage.
A HUBZone business is a small business operating in a “Historically Underutilized Business Zone.” This Small Business Administration program promotes job growth, capital investment and economic development to economically distressed communities known as HUBZones. The Small Business Administration provides detailed information about HUBZones and their locations.
State and Local Certifications
There are also local and state certification programs that may be more appropriate for your business, depending on where and to whom you sell products or services.