Minority Business Enterprise Certification Increases Access To Government, Private Contracts
Posted on: 19 July 2021
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The Minority Business Enterprise (MBE) designation is a unique opportunity for businesses primarily owned by minorities to access dedicated contracts from government, corporate, and non-profit entities.
Certification is provided by the National Minority Supplier Development Council, Inc. (NMSDC) and provides access to an assortment of benefits ranging from networking, business fairs, and capacity building to more direct links to contract work opportunities.
For a U.S. business with 51% or greater ownership by minority individuals, a simple application form starts the certification process with NMSDC. After the MBE designation is achieved, marketing efforts can include the MBE as a promotional point.
Historically, minority-owned businesses suffered from competitive disadvantages, and the MBE designation is a way to secure access to a variety of new clients and customers via strategic promotion and networking.
Access to government contracts is a key benefit of submitting an application and moving through the site visit process to NMSDC registration. Many contracts for water projects, construction, office supplies, and routine services from the municipal level up to state and federal government are segmented with dedicated funding allocated for minority businesses. These allocations take the form of direct contracts awarded by the government or mandated benchmarks for contractors to meet when hiring enterprises to fulfill various components of a larger project.
The same basic requirements also exist in many non-profit projects, particularly for non-profits who receive funding from federal and state programs. In the corporate world, larger businesses often set internal or external goals committing to spend a minimum amount or percentage of funds with minority enterprises.
For businesses with a Minority Business Enterprise certification, a portion of the heavy lifting to secure these contracts is already accomplished due to the expansive audit completed by the NMSDC prior to certification. This streamlined ability to submit bids and proposals for contracts increases efficiency and expands an enterprise's reach. With the time saved, additional bidding and networking can be accomplished, increasing access to opportunities with other industries.
Outside of bids and contracts, the MBE designation also provides a marketing edge when soliciting business in the local community and with direct sale customers. With an increased focus on economic diversity, an ever-increasing range of consumers want to support minority-owned businesses with their everyday shopping and larger needs, such as home construction, accounting, and more. Achieving certification lets customers know they are supporting a true minority-led enterprise versus a business where minorities are employed.