Doing business with the state
Virginia simplifies certification process for small, women and minority-owned companies

by Lisa Prezioso Linnell
for Virginia Business
May 2007

Stacy L. Burrs knows that business owners have enough to handle without plowing through bureaucratic red tape. That’s why he is trying to get the word out that the state’s certification process for small, women-owned and minority-owned companies has gotten easier.

The state began a campaign three years ago to award more contracts to these businesses (known by the acronym SWAM). The push came after a survey conducted during the administration of Gov. Mark R. Warner revealed that minority-owned companies were getting less than 1 percent of the commonwealth’s procurement dollars.

To submit bids for state jobs, the companies had to be certified as bona fide SWAM companies. The commonwealth defines small businesses as those with less than $10 million in gross receipts and fewer than 250 employees. Women and minorities must own at least 51 percent of a business for it to be designated as women- or minority-owned.

These days the once-daunting, drawn-out certification process has been streamlined, says Burrs, director of the Virginia Department of Minority Business Enterprise. Gone are requirements to submit up to 31 pieces of documentation, including many notarized copies. Now, applicants need two photo IDs, proof of investment in the company and proof that the company is legally registered.

Delays that typically caused SWAM certification to take up to 60 days have been whittled down to a process that usually takes two weeks. And VDMBE has revamped its Web site to make the process user-friendly. “One of the primary tenets of purchasing is competition. The other tenet is fairness,” says Burrs. “Our goal is helping the commonwealth in finding the right balance of competition and fairness.”

As of the end of March, nearly 11,000 businesses have been certified by the state, many of them since Burrs took the helm of the department a year ago. But for Burrs, that’s not enough. “We think more in terms of the number that aren’t certified,” he says.

The latest business survey by the U.S. Census Bureau found that Virginia had more than 157,000 women-owned companies, more than 41,000 black-owned businesses and nearly 19,000 Hispanic firms in 2002.

Tinh duc Phan, chairman of the Virginia Asian Chamber of Commerce, encourages his members to become SWAM-certified but often meets with resistance. “The Asians are a more laid-back people. They don’t want to get involved with the government. They are afraid of the paperwork,” he says.

“Normally they don’t trust the government. It’s a lot of talk and no action.”
Phan tells these business owners that the state government has changed its ways to benefit minority-owned companies. “I see a new breeze coming in for the SWAM people, if they start seeing that the government pays attention to them more.”

SWAM companies are slowly gaining more state business. In the second quarter of the 2007 fiscal year, minority-owned businesses garnered 2.21 percent and women-owned businesses got 2.16 percent of $1.07 billion in discretionary procurement purchases.

SWAM companies find out about procurement opportunities by registering on eVA — short for Electronic Virginia, the state’s computerized procurement system. Only businesses registered in eVA are eligible to compete for the commonwealth’s business. As part of the eVA program, businesses receive e-mail notices of upcoming bids.

SWAM-certified companies are designated as “preferred” vendors on eVA. State agencies are required to obtain quotes from SWAM companies. “All things being equal [in terms of cost to the state], you go with the preferred vendor,” says Burrs.

A Richmond-based woman-owned business has seen its revenue grow since becoming SWAM-certified in 2002. The Spanish Academy & Cultural Center offers Spanish language immersion programs to government and corporate clients. Owner Lisa Zajur says about half of her 2006 revenue resulted from SWAM contracts, including the state’s Department of Juvenile Justice, where she trained parole officers and prison guards.

Zajur encourages other women to certify their businesses. “It’s looking to the future and growing your profit. They help you go into bids that maybe you wouldn’t think of doing,” she says.