Boosting Businesses for Women

A nationwide program to increase the number of women-owned businesses that obtain corporate and government contracts has started in Los Angeles, one of three initial locations.

The effort includes a certification program to vouch that businesses are women-owned and an online registry for use by corporations and government agencies seeking to do business with such firms.

“We’re meeting a great demand in the market, and we’ve received a lot of interest from corporations all over the country about this,” said Kathleen Schwallie, president of the Women Business Owners Corp., a Palos Verdes-based nonprofit organization that started the project in cooperation with the Los Angeles chapter of the National Assn. of Women Business Owners.

The program began in January with 25,000 women-owned businesses that are currently certified by various government agencies, such as Pueblo Contracting Services of Los Angeles, which rebuilt the Angels Flight funicular downtown. Corporations have already begun calling asking about certain categories of businesses, Schwallie said.

The program was started amid growing anti-affirmative action sentiment in California and the nation, characterized by attempts such as Proposition 209 to end government programs that target participation by women and minority-owned businesses.

Schwallie said part of the concern over affirmative action arose over “front” businesses. The certification program would ensure that women-owned businesses on the list are truly owned and operated by women, she said.

Certification is the process by which businesses owned by minorities, women, veterans, the disabled and those in other categories qualify for contracting outreach programs by government agencies. Typically, each government agency has its own certification program. A minority- or woman-owned business seeking to bid for contracts with a variety of agencies usually must submit applications to each.

The new program is an attempt to simplify the procedure with a single certification standard, Schwallie said. Although initially the program will focus on use of the online registry by private companies, some government agencies have already begun asking about it, saying they see it as a way to cut government costs, she said.

The need for the certification program became apparent to the National Assn. of Women Business Owners two years ago, when the federal government set a 5% goal for women-owned businesses in all its government contracting.

Last year, only 1.8% of all government contracts, about $3.4 billion worth, went to female-owned businesses, even though they make up approximately 40% of all businesses nationwide, Schwallie said. Corporate America did only a little better, making 2.7% of its purchases from women-owned businesses, according to a study by the National Assn. of Purchasing Management.

The WBOC program has received funding from corporate sponsors such as Walt Disney, IBM, Hughes Electronics and Coca-Cola.

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During the first six months of the program, certification applications will be processed and on-site visits made by NAWBO Los Angeles, the Texas Center for Women’s Business Enterprise and NAWBO Greater Detroit/Excel. Other women’s business organizations are expected to begin participating in San Francisco, Phoenix and the New York-New Jersey area.

Plans include an electronic database listing opportunities for female contractors and online training on procurement.

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Leading Ladies

California is home to the largest number of female-owned businesses in the nation. Such firms, which have increased 78% since 1987, account for a third of all companies in the state. A look at the states with the most companies owned by women in 1996:

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Number Number of of firms employees (millions) (millions) California 1.08 2.34 Texas 0.55 1.10 New York 0.53 1.37 Florida 0.50 1.29 Illinois 0.34 0.95 Ohio 0.31 0.74 Pennsylvania 0.30 0.86 Michigan 0.26 0.53 New Jersey 0.22 0.62 Georgia 0.20 0.62 Total U.S. 7.95 18.50

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Source: National Foundation for Women Business Owners

Researched by JENNIFER OLDHAM / Los Angeles Times