A Disadvantaged Business Enterprise (DBE) certification is given to any small company owned by a person (or persons) who are considered to be in a disadvantage in social and economic terms when compared to the majority.
DBE was previously used to make sure federal funds are given to specific highway construction projects to create healthy competition but are now used in a wide variety of industries, still keeping the same goals of creating fair competition in mind.
The Small Business Administration decides the standards according to which a business is considered disadvantaged. It’s usually based on the size of the company, i.e., it’s average annual revenues. Also, the owner cannot have a personal net worth higher than $1.32 million.
Naturally, additional requirements are that the owner or owners belong to a minority group and that they are citizens of the United States or lawful permanent residents.
If you meet these standards, it’s highly advisable to consider applying for the certification as the benefits are many, and the DBE program is considered by most to be quite helpful for business growth in the realm of government contracting.
The Benefits That Propel Growth
Since the DBE enables smaller businesses, which can rarely compete with other bigger companies, to be on par with more extensive operations and gain government contracts. It’s evident that the certification is more than merely beneficial.
By gaining big contracts on important government-funded projects, a small business can achieve the recognition it craves. Smaller companies usually have a hard time getting noticed, and a DBE can prove to be the marketing your small business needs.
The contracts also imply the procurement of additional funds which are needed for the project and can help the business develop further.
The financial aid is indeed the main advantage of DBE that enables your business to grow, but there are also other benefits. Being included in the program gives your business a chance to gain many business contacts within your industry. These contacts can always provide your business with additional work that will further the company’s growth.
Additionally, many of the high-profile projects in the entire country often require that a specific percentage of contractors are DBE-certified businesses. Like we previously mentioned, the projects themselves provide work and good marketing for your business, but most are smaller local projects which cannot be measured with high-profile cases. Being a DBE on one of these high-profile projects provides these same benefits but on a much higher scale that can be utterly transformative for a small company.
The Bottom Line
The conclusion is clear; the benefits are many, and most of them propel the growth of your company. Naturally, there are plenty of legal requirements to examine, so if you are considering gaining the DBE status, you should contact Chestnut Street Consulting LLC. We take pride in enabling smaller businesses to meet their potential, and we specialize in programs like the disadvantaged business enterprise.