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There are many important benefits and advantages available to businesses owned by women and/or minorities, but in order to qualify for them a business must become certified as a minority- or woman-owned enterprise. Connections, marketing assistance, and technical training are just some of the benefits that come with certification, says Susan Rittscher, president and CEO of the Center for Women & Enterprise, the New England affiliate of the Women’s Business Enterprise National Council, a leading certifier of women-owned businesses. (Others include the National Women Business Owners Corporation and the National Association of Women Business Owners.)


“First and foremost, if the diverse-owned business is interested in pursuing bids or contracts with a large corporation with a supplier diversity program, a state agency, or a federal agency, they must be certified in order to count toward supplier diversity goals,” Rittscher says. Another benefit of certification is connections to other certified businesses, which can be a powerful network of potential partners, clients, and advisors and mentors. “Certification is a strong marketing and selling tool for business owners when leveraged effectively,” she adds. Certified businesses may also have access to exclusive programs and services such as professional development workshops and networking and matchmaking events.


Tom Greco, vice president of, a free platform with a database of more than 610,000 companies, notes that there are many different ownership/diversity certifications that provide a competitive advantage to qualifying companies, and many businesses and government agencies are anxious to do business with them. “Indeed, 72 percent of buyers recently surveyed by CAPS, a research arm of the Institute for Supply Management, said they would be increasing their spending with diverse suppliers. Diverse businesses include Women-Owned Businesses and Minority-Owned Businesses as well as Veteran-Owned Businesses, Small Disadvantaged Businesses, HUBZone Businesses, and Service-Disabled Veteran Businesses,” he says.


While the process for obtaining various kinds of certification varies, Greco suggests that a business seeking any of the certifications mentioned above start by self-registering with the federal government’s System for Awards Management (SAM), since that is a requirement for most types of certification. Next, seek out one of the major certification organizations for your diversity group—such as WBENC for a women-owned business or the National Minority Supplier Development Council for a minority-owned firm. In most cases, minority-owned business certification falls under the purview of the individual states. Check out this useful list of certifying agencies by state to learn more.


It is important to note that in order to qualify for minority- or women-owned certification, the business must not only be owned by minorities or women but also controlled by them, says Dean dt ogilvie [ed. note: lack of capitalization is intentional and should be retained], the dean and a professor of business strategy at the Rochester Institute of Technology’s Saunders College of Business. “They have to be the ones making the decisions about strategy, business, and structure. They can’t just be figureheads to get the certification,” she warns. Owners must provide required documentation to prove ownership and control; they must have contributed capital and/or expertise to the business; they must be U.S. citizens (or, for some programs, resident aliens); and they must be independent in decision-making, Rittscher says.


Lisa Firestone is president and owner of Managed Care Advisors (MCA), a woman-owned employee benefits and disability management consulting and workers’ compensation case management firm based in Bethesda, Maryland, and she believes certifications and the set-asides to which they provide access play an important role in leveling the playing field for companies like hers. MCA is a certified minority business enterprise in Maryland and several other states and a WBENC-certified woman-owned business. In 2012 it also became certified as an Economically Disadvantaged Woman-Owned Small Business. “Honestly, before my business entered into government contracting, certifications and set-asides were unfamiliar concepts, and ones that made me a bit uncomfortable,” she says. “But what I have learned is that there really is no ‘special consideration,’ but just an opportunity to level the playing field and compete effectively. Certifications can get your business noticed, but they are not a direct conduit to a contract. You still have to get out there, compete for that business, and win it.”


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Steve Strauss

The B Word

Posted by Steve Strauss Apr 28, 2014

It is safe to say that people start businesses for many different reasons:


  • Maybe someone loves doing something so much that he just had to take a risk and build a business around that passion
  • It might be someone who always longed to be her own boss and when the opportunity arose, she took it
  • It may be that they are what we call “accidental entrepreneurs”- people who lost their job, whose unemployment ran out, and who had no other choice


Whatever the reason, you can safely assume that all different types of entrepreneurs have one thing in common: They probably didn’t go into business because they love crunching numbers and making budgets (unless, of course, the entrepreneur is an accountant, but I digress.)


But budgeting is one of those things that business people usually learn to do, sooner or later, because they have to, because staying afloat and being professional requires it. For newer businesses especially, budgets are often something to be endured at best and avoided at worst. Since there are so many other things to do in the start-up phase, projecting and budgeting can easily be put off for another day.


However, that is a big mistake. Think of it this way – would you ever get in your car, put a bag over your head, and drive off? Of course not. With a bag over your head, you would never know if you were headed in the right direction, you couldn’t see any dangers down the road, and you wouldn’t even know if you had enough gas to get where you wanted to go.


That is exactly the same situation when you run a business without a budget. Without a budget, you might have a vague idea of your cash flow, profitability, and money situation, but you don’t really know if you have enough money to get where you want to go. Creating a budget allows you to take the bag off of your head, get your bearings, and head in the right direction with the confidence you need to make smart decisions.


Often, new entrepreneurs learn about budgeting the hard way. In the early stages of a business, cash flow is usually an issue. Money comes in, some bills get paid, others don’t, and budgeting for the future is put off. The problem is that with cash flow so erratic, the new entrepreneur without a budget has no tool to help him or her analyze how best to use their money. Should they invest in that Google Adwords campaign, and if so, how much? Can they afford to hire that independent contractor? Without a budget, it is really tough to know.


Let me also suggest that another reason why many small business people put off budgeting is simply because of the word itself: “budget.” Not a lot of people like that word, entrepreneurs especially. Budgeting often connotes restriction, and especially with the freedom that entrepreneurship can bring, constraint can feel alien.


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So consider this instead: Substitute the word “plan” for “budget.” Because, really, that is all that a budget is; it is your financial plan for your business. Would you like to grow your business this year? Great, then you probably need to spend more on advertising and marketing. Make that part of your plan. Are you spending too much on labor? OK, make that part of your plan too.


Here is the easy way to do it: For three months, track all of your spending. Create as many categories as you can and faithfully record where you are spending your money right now. There are many excellent software programs you can use, such as Quickbooks, Peachtree, or Freshbooks. You could also simply create a spreadsheet using Excel.


Then, analyze the data. By taking the paper bag off of your head and seeing where you are headed, you will be better able to make a course correction. Want to spend more on new equipment? Then maybe you can cut back on transportation costs. Perhaps you see that you are spending too little on labor, or too much on insurance. Whatever the case, by analyzing your spending you will now be able to make smarter, better, more informed decisions.


If you are unsure how much to spend on different categories, ask yourself these two questions:

  • How much do you need to keep the doors open? (rent, labor, taxes, insurance, etc.)
  • What spending will give you the biggest bang for your buck?


In the beginning, this is a matter of trial and error, but after a while you will see what works best for you and your business. Double down on that.


After all, it is your budget – err, I mean plan – and you can use your money however you want.



About Steve Strauss

Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert column is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest,The Small Business Bible, now out in a completely updated third edition. You can listen to his weekly podcast, Small Business Success, visit his new website TheSelfEmployed, and follow him on Twitter. © Steven D. Strauss.

You can read more articles from Steve Strauss by clicking here

Growth potential and the need for financing go hand-in-hand. “Certain milestones or trigger points are common growth challenges that require additional financial support if the business is going to move to the next level,” says Ray Vargo, director of the Small Business Center at the University of Pittsburgh’s Institute for Entrepreneurial Excellence. Among those trigger points are the need for more staff, sales growth that exceeds existing production capacity, the need to purchase new equipment and/or arrange for additional facilities, and expansion into new markets, he says.


It is critically important for business owners to be proactive in creating a plan for future growth. “They must be both forward-thinking and flexible,” Vargo says. “Owners should always plan ahead and anticipate future milestones, but they should also regularly examine the current state of their business and try to identify new opportunities that weren't originally planned for and then determine the sort of financing needed to pursue such opportunities.”


Lindsey Gilkes, a management consultant at the Institute for Entrepreneurial Excellence, suggests conducting a brief checkup of your business at the end of every fiscal year. Here is a suggested roadmap for the process:

  • Identify your three major current concerns about your business.
  • Conduct a thorough financial review of the previous year’s performance with a focus on key ratios, such as your margins relative to the industry average, inventory turns, and cash flow (including receivables and payables turnover rates).
  • Compare your previous year’s actual performance with the numbers you had projected for it.
  • Set specific financial and other performance goals for the coming year.
  • Develop a plan with concrete strategies for achieving those goals.
  • Include due dates for each goal and contingency adjustments to be made during the year for goals that are not being met.
  • Designate who in your organization will be primarily responsible for achieving each goal.


Examining your budget and your current balance sheet in conjunction with your action plan will help you identify where you might need financing to complete items on your action list and what type of financing is likely to be most effective and accessible, Gilkes says.


Financing plans with accurate projections are not difficult to create, says Rob Dennison, a national partner in Irvine, California-based Hardesty LLC, an executive services firm focused on the office of the CFO. The challenge is executing the plan to achieve the desired results. “It’s imperative to have a flexible plan that can be adjusted and allows for modeling of unexpected events.”


Defining needs and assigning associated weighting to their importance is an integral part of this process, and some key considerations include:

  • Expansion versus risk mitigation. Potential revenue and profit gains from expanding into new areas or market segments must be weighed against the costs of mitigation measures required for new risk factors, i.e., currency fluctuations or political instability in new overseas markets.
  • Securing the best terms and the impact on timing. It makes sense to secure the best financing terms possible, but having the financing already in place may be a more important consideration for expansion minded businesses so you can move quickly when opportunities arise.
  • Business stage-to-financial stage ratio. Different types of debt and equity financing are generally more available to businesses at different stages in their development. Make sure your financing efforts align with your current business stage to improve your chances of success.
  • Capital allocation plan. Lenders will want to know what you plan to do with the money. Have a detailed plan ready that ties the funds being requested to specific business goals (purchase of new equipment, expansion of production lines, etc.).
  • External issues and “unknown unknowns.”


“Knowing the most effective way to allocate your funds is of primary importance to any business,” say Evan Charles, co-founder of Boston-based Launch Academy, a provider of coding and web development training. “Misjudgment here can result in wasted money and time.” Start with long-term and associated short-term business goals, make sure the contemplated spend aligns with those goals, and confirm you are taking the correct strategic next step rather than skipping ahead, he advises. “Be protective of your assets as if you have two personalities: One is an entrepreneur—that’s easy—and the other is a tight-fisted investor. If you are not financially savvy, seek help. The cost will far outweigh the spend.” Dennison adds that the goal should be to create a plan that anticipates growth and puts financing in play before it’s needed. “Anticipation versus reaction should be the theme as it relates to financing,” he says.


For more information on different approaches to building a finance plan geared for growth and gauging the health of your business, check out:


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Content created exclusively for Bank of America.



Maximizing-Tax-Credits.pngAs a small business owner, are you taking advantage of all the deductions you are entitled to? With our new guide, Maximizing Tax Credits for Small Business, you’ll have the information you need to make the most out of your deductions come tax time.


Click here to download the Maximizing Tax Credits for Small Business guide.

There are many things to handle when you own a business: Of course, you need to be on top of sales, inventory, and advertising. You also probably have your hands full with everything from shipping to social media marketing to labor issues.


So, when was the last time you monitored your business credit?


If you are like most small business people, you haven’t done it in quite a while. While that’s understandable, it is also a mistake - and a potentially costly one at that.


Example: Joe owned a computer repair shop for many years. It was an established and successful business, so he never thought much about business credit. He ran his business off of his profits.


Then the recession hit, and Joe’s business took a dive. The problem for Joe was that because he had been ignoring his business credit for so long, when he needed a short-term line of credit to tide him over, he couldn’t get it.


It turned out that for many years, inaccurate derogatory information was being reported to Joe’s business credit profile. A company with a similar name to Joe’s business had hit hard times too, started paying its bills late, and eventually filed for bankruptcy. All of that was, unbeknownst to Joe, mistakenly being reported onto his business credit report. Since Joe had not been monitoring his credit, he never caught the mistake, and when the time came for Joe to use what he thought was stellar credit to help his business, it was almost too late.


It took six months of letters, documentation, and acrimony before the errors were discovered and corrected, and in that time, Joe almost went under.


Don’t think that Joe’s experience is unique, because it’s not. More than one billion pieces of information are reported to personal and business credit files every month, so there are bound to be mistakes. The way the system is designed is so that it is incumbent upon you to make sure your credit profile is correct. It is your responsibility to check your credit, no one else’s.Steve-Strauss--in-article-Medium.png


Up front, it is important to note that your business credit should not be the same as your personal credit, although for a lot of small businesses it is. Most people start their business with their personal credit, at least partially. However as soon as you can, you need to separate the two. The way to do that is to set up a separate and distinct credit profile for your business. You do so by getting a taxpayer ID number from the IRS, and then a DUNS number from Dun & Bradstreet Credibility Corp.


You may also need to review your personal credit profile. You are allowed by law to receive a free personal credit report, once a year, from


Click here to read more articles from small business expert Steve Strauss

Monitoring your credit report(s) allows you to:


Find and correct false information: As Joe’s cautionary tales exemplifies, you must monitor not only your personal credit profile, but your business profile as well.


There are any number of things that can be inaccurate on your business credit profile:


  • Someone else’s bad information showing up on your credit report as yours
  • Debts that are not yours being reported as yours
  • Omissions of your good payment history
  • Not having false or outdated information being removed after 7 to 10 years, as the law generally requires


And the beat goes on. It is vital therefore that you closely monitor your DUNS report so you can catch errors before they hurt your business.


Avoid identity theft: In this era where even large corporations can get hacked, it behooves all of us to keep a very watchful eye on our credit report. According to a study by McAfee, 60% of small business that are a victim of identity theft never recover and go out of business within six months.


Get the credit you deserve: The point of all of this monitoring is to make sure that your business credit report accurately reflects that you pay your bills on time, because once it does, it also shows potential lenders and investors that your business is a good risk. The likelihood that you will get the credit you need grows with each positive entry on your credit report.


Thus, by regularly monitoring your credit profile, paying your bills on time, and keeping your debt low, you may be able to get a good loan at a reasonable rate when you need it.

About Steve Strauss

Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert column is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest,The Small Business Bible, now out in a completely updated third edition. You can listen to his weekly podcast, Small Business Success, visit his new website TheSelfEmployed, and follow him on Twitter. © Steven D. Strauss.

You can read more articles from Steve Strauss by clicking here

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