Get in the Zone: Why your Small Business Needs a HUBZone Certification

With the resurgence of Coronavirus cases across the nation, many small businesses are struggling to stay afloat, especially with so much uncertainty as to when the “return to normalcy” shall begin. According to data from Yelp, roughly 55% (~72,842) of businesses that closed due to COVID-19 will never reopen. Although these figures may instill fear or even hopelessness for small business owners across the U.S, they are also a call to action; business owners must now seek legitimate ways to positively impact their businesses, and one way to do this is by qualifying and applying for a Small Business Certification.

At a glance, Small Business Administration (SBA) programs may seem to be reserved for a certain subset of business owners. In reality, there is an eclectic mix of programs that small businesses can qualify for, including one commonly overlooked option — the HUBZone program.

What is a HUBZone?

Created by the U.S Congress in 1998, the Historically Under-utilized Business Zones (HUBZone) program began with the intent to incentivize the U.S federal government to form contracts with businesses which operate and create jobs in communities that have statistically-proven economic needs. In order to determine if your business currently resides in a HUBZone, check out the HUBZone Map.

What Businesses are eligible for the HUBZone Program?

According to the Office of the HUBZone Program, a business is eligible if:

1. The Business qualifies as a small business (in accordance with SBA standard)

2. At least 51% of the business is owned and controlled by U.S. citizens, a Community Development Corporation, an agricultural cooperative, or an Indian tribe

3. Its principal office resides within a “Historically Under-utilized Business Zones,” which includes both military facilities closed by the Base Realignment and Closure Act and lands considered “Indian Country.”

4. At least 35% of the aforementioned company’s employees live in a HUBZone

What are the benefits of a HUBZone Program?

Given the disadvantages a HUBZone-certified business may face, the federal government has set a goal of awarding 3% of its federal prime contracting money to HUBZone-certified small businesses. This gives HUBZone-certified businesses a greater chance of receiving a contracting bid with the government, further leveling the playing field. Other benefits include a 10% price evaluation preference in full and open contract competitions, as well as subcontracting opportunities.

How can I apply for HUBZone status?

The HUBZone program application — as well as the instructions one must follow to successfully become certified — can be found at this link.

These are amongst the first steps to become certified, and business owners must be adamant about maintaining their HUBZone status and cognizant of when they need to reapply. HUBZone certifications do not automatically lead your business to immediate profits, so in order to learn more about the program and how to leverage your certification, make sure to check out the SBA’s HUBZone program page for more information.