Know The 8a Certification Basics & Requirements
A company that obtained 8a certification basically means that the business applied for SBA 8(a) Business Development Program. Only the companies that are eligible for 8a certification gets recognized by the federal agencies to give them federal contracts. A business entity must match all the prerequisites of the SBA program.
The federal government of the United States designed such a developmental program to support the small and local businesses. As a result, the program helps the socially and economically disadvantaged individuals for doing business with the federal agencies. It also gives support to the economy of the United States.
Before we talk about the requirements for obtaining the 8a certification requirements, we will first talk about the 8(a) business development program. It will help the readers to understand the basics in the very beginning.
SBA 8(a) Business Development Program
The SBA 8a Business Development Program is a government program of the Small Business Administration (SBA) that helps disadvantaged small and enterprises to win government contracts in the federal marketplace. The government’s annual goal is to award at least 5% of all contracts to such companies.
A disadvantaged entity is an organization that is wholly owned and controlled by one or more individuals defined by the SBA as being socially and economically disadvantaged.
Such individuals are members of certain groups such as African Americans, Native Americans, and Hispanics, or are experiencing social disadvantages based on race, country of origin, gender, physical fitness, and so on. Basically, it refers to the socially and economically disadvantaged individuals.
Criteria to get your business SBA 8(a) certified
You must qualify to the eligibility criteria of the 8(a) program before you can enjoy 8(a) certification benefits. We have already said that only small and disadvantaged businesses can pass the 8a certification eligibility test. We have explained some of the important factors that will ensure high chance of obtaining 8a certification.
Small business
The program is intended for small market participants only. The average three-year income must not exceed certain government-set thresholds. That is why, the program is for small businesses and not for gigantic enterprises.
First time participants
Don’t apply again, if you have already participated in the 8(a) program and obtained 8a certification. It is quite obvious but still it is important to remember.
Disadvantaged
As we have mentioned above, your business needs to be at a disadvantage. Business owned and controlled by socially and economically disadvantaged people (which means at least 51% ownership). The economically disadvantaged individual in the United States must not exceed the asset value over $4 million.
Good character of the principle owner
The owner of a business should not have any sort of criminal record. They cannot violate the SBA terms and conditions. They should not carry any report that shows that they have been suspended before. Also, submitting false information for 8(a) registration is also prohibited.
Potentially successful
The business should have potential for success. The business must have a positive record for operating in the market for quite some time. Your company must not be in debt as it is a negative record which shows an unreliable factor in your business. The business should have adequate capital and essential capabilities such as personnel, equipment etc. to process the GSA contracts.
Conclusion
So you got to know that the 8a certification is not developed for everyone. The certificated is only for small and disadvantaged business owners in the United States. If you think you have the above mentioned factors in your business, then only you can apply for 8a certification. If your business is already 8(a) certified then connect with federal agencies to secure federal contracts.