Helping Women Entrepreneurs Land Corporate Contracts

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Women businesses still get a very small percentage of the venture capital, however. That has not changed too much. I don't know if that's because women don't know how to seek venture capital, if they don't seek it because they don't want to give up control of their companies, or if it's just not an appropriate source of funding for many women-owned businesses. There are a lot of possible reasons, and not all of them have to do with venture capitalists not giving women-owned companies a chance (see BusinessWeek.com, 6/13/07, "The Venture Capital Myth").

How large are the companies that get certified?

The largest company we have does about $20 billion in annual revenue, and we have seven or eight certified companies with annual revenues over $1 billion. But the average WBENC-certified companies average just under $8 million in annual revenues. The lower end of the range goes down to several hundred thousand in annual revenues, so we have a lot of companies that are maybe sole proprietorships or have one or two employees. They tend to be consultants, speakers, or trainers. We're not looking at size, we're certifying that the company is at least 51% woman-owned, -operated, and -controlled.

What areas do you plan to prioritize as the organization's president?

I want to continue the great work we've done helping corporations understand that women-owned businesses are a vibrant prospective vendor base. We get weekly inquiries from corporations that are looking to expand their supplier diversity network, so I want us to continue connecting them to women-owned companies that can help them do that.

Another priority for me is to see if we can't establish a universal women-owned business certification process. There are several programs like ours out there that are either duplicates or weaker versions of what we do. While the WBENC certification is the most commonly accepted by corporate America, government agencies and certain other entities want other certifications.

We have one member who does a lot of work at airports and she has a full-time person on her staff who does nothing but keep her certifications up to date. It's burdensome and expensive to have to do that. Our certification costs a couple hundred dollars, but some of the others cost more than that. So I hope I can work with other groups to save women business owners a lot of time, duplication of effort, and money by pushing for a universal certification process that would be accepted across the board.

And finally, I'd like to continue helping grow the capacity of these women-owned businesses and helping them understand how they fit into this global supply chain. If they're not cognizant of the way things are changing internationally, they're going to miss out on a lot of opportunities. Part of what we're doing is working closely with a group in [Britain] to set up a WBENC-type certification process there.

Do large corporations outside the United States have similar priorities around supplier diversity and contracting with women-owned firms?

I'm afraid that the U.S. is miles ahead of the rest of the world in that regard. We chose [Britain] for our first certification globally because the government there has a strong mandate for supplier diversity as it prepares to host the Olympics in 2012.

Your group recently did a survey looking at how female consumers regard women-owned businesses. What did it find?

It showed that women consumers care if a corporation is buying supplies from women-owned businesses. They care enough to drive them to try a product or service for the first time, give it a second chance and remain loyal for the long term. We surveyed 1,200 women across the United States and demonstrated for the first time that corporations can seize a competitive edge by doing business with women-owned suppliers.

Almost 80% of women consumers said they would be compelled to try a company's product or service if they were not already a customer, but if they knew a company used women-owned businesses as vendors. Another 80% said awareness of a company's practice of buying from women's businesses would moderately or significantly solidify their brand loyalty. And 51% said they would even give that company a second chance if the product or service missed the mark the first time.

We were amazed at the strong response to the questions we asked, but the percentages didn't surprise me. Now we have to educate our corporate members on this issue and let them know that they can and should use their supplier-diversity commitments to market their products and services.

Karen E. Klein is a business journalist who covers small-business issues for several national publications. She writes her Smart Answers column twice a week.