The Value of LGBT Business Certification
LGBT Business Certification is the first part in a three-part series focused on getting minority- and diverse-owned businesses certified nationally to ensure recognition, as well as qualification for government and private contracts for good and services. Parts 2 and 3 will focus on minority-owned and women-owned businesses, respectively.
Though we’re fresh on the heels of Pride 2016, it’s not too soon for the LGBTQ business community to start thinking about a stronger local and national presence for the year to come. However, there is one critical component to improving brand awareness and community presence that many LGBTQ business owners may not be aware of: Certification as an LGBT Business Enterprise
While some 864 LGBTQ businesses nationwide now have LGBT business certification, this represents only a fraction of businesses that qualify. According to David Perry, National Director of LGBT Outreach for the Small Business Administration, there are approximately 1.4 million LGBT-owned businesses. So 864 is a startlingly meager .06 percent of all LGBT businesses who are actually have LGBT business certification.
The certifying agency is the National Gay & Lesbian Chamber of Commerce (NGLCC). Begun in 2002, the NGLCC was founded by Justin Nelson and Chance Mitchell when they “realized no one had really considered the economic equality of LGBTQ people or the impact economics could have on the equality movement.”
And, they were right. Before the NGLCC, there hadn’t been a concerted, national effort to advocate for LGBTQ economic equality or to show just how much economic power the community wields. In 2004, shortly after their founding, the “NGLCC created a best-in-class diversity certification program, making the organization the exclusive national third-party certifying body for LGBT-owned businesses.”
Since its inception, the NGLCC has gained over 140 national Corporate Partners from Apple to United Airlines, all of whom regularly work with the NGLCC to find businesses with LGBT business certification to fill their needs. In addition to these multinational corporate partners looking for local LGBT businesses partners, the NGLCC works with 52 Affiliate Chambers across the United States.
Why LGBT Business Certification?
That’s all well and good, but you’re busy and you can’t be throwing your cash around on expensive certifications without knowing there’ll be some real return on your investment.
According to Louise Chernin, CEO of the Greater Seattle Business Association, a Townsquared partner, “For small businesses that have had barriers, the certification is one more opportunity to be identified as minority-owned and to do business with companies that want to invest money in a diverse supply chain.” And LGBT business certification doesn’t just mean being identified as minority-owned; it means being promoted as such to some important folks: corporations who want to do business with you, if they can find you, and a customer base with a lot of spending power.
According to the NGLCC, membership means that you as a business receive:
- National recognition by America’s top corporations as a certified LGBT Business Enterprise.
- Eligibility to exhibit at the annual NGLCC Business and Leadership Conference, as well as at regional events.
- Automatic inclusion in the NGLCC’s online searchable database of certified businesses, which is accessible by NGLCC Corporate Partners.
- Use of the NGLCC Certified Business logo on your marketing materials, identifying your business as a certified LGBT Business Enterprise through the NGLCC to the NGLCC’s national network.
- Eligibility to receive sourcing opportunity e-mails from the NGLCC and its Corporate Partners.
- Eligibility to participate in mentorship programs, leadership trainings, and scholarship opportunities presented by NGLCC Corporate Partners.
The fact is, the organization’s list of influential Corporate Partners (remember, this is 140 of the Fortune 500 companies) can translate into a lot of extra promotion—and dollars—for LGBTQ businesses, once they’re certified.
These corporate partners really want to reach the LGBTQ market. For one thing, LGBT yearly spending has been estimated at almost $800 billion dollars. Nielsen research from 2015 revealed that “LGBT households make 10 percent more shopping trips in a year” than the average U.S. household, and they’re likely to spend more each trip, especially on certain types of products. (LGBT households were 72 percent more likely to to shop at book stores than the average U.S. household. Go bookworms!) Furthermore, according to research published in Business Insider, LGBTQ consumers are significantly more likely than other groups to spread the word when they find a brand they like. They’re also more willing to pay a little extra for those trusted brands.
In other words, there’s a sizeable market that NGLCC’s Corporate Partners want to impress. And corporations are realizing that to get a chunk of that nearly $800 billion market share, they need to earn it. LGBTQ shoppers are fiercely loyal to brands they like, Corporations need to do more than advertise; they need to work and partner with actual LGBT-owned businesses.
So, pretty good perks all around.
Great! How Do I Get Certified?
Getting certified involves more than simply signing up as a member of the NGLCC. The steps involved in the process can be complex and time-consuming, but they’re a necessary part of maintaining the integrity and legitimacy of the Certifications. To make the procedure easier, we broke down the process for LGBT businesses interested in getting certified.
The basic criteria you’ll need to meet before even applying? Well, your business needs to be “at least fifty-one percent owned, operated, managed, and controlled by an LGBT person or persons who are either U.S. citizens or lawful permanent residents.” Eligible businesses must also:
- Exercise independence from any non-LGBT business enterprise
- Have their principal place of business (headquarters) in the United States
- Have been formed as legal entities in the United States
Hang On…How Much Does This Cost?!
You own a business, so you knew this was coming. Well, you’re right. Certification as an LGBT Business Enterprise can be a bit steep. At $400 for initial certification and $200 a year for recertification, the price may seem prohibitive. But, bear in mind that with that price tag come a lot of perks beyond promotion to corporate funds for goods and services. You’ll also have access to educational opportunities, events, and national recognition as an LGBT-owned business.
If the price tag has you down, don’t give up—there’s good news ahead. You may be eligible to have the fee waived, if you’re a member of your local Affiliate Chamber!
The NGLCC has worked hard to form dedicated partnerships with local organizations and Chambers that are at the forefront of LGBT business advocacy. And, it just so happens, there’s one of these stellar organizations in each of Townsquared’s current geographic networks: the San Francisco Bay Area, Seattle, and NYC. If you hold membership with one of these local organizations, you qualify for a fee waiver:
- SF Bay Area: The Golden Gate Business Association
- Seattle: The Greater Seattle Business Association
- NYC: National Gay and Lesbian Chamber of Commerce NY
- Portland: Portland Area Business Association
If you’re not in one of the areas above, don’t worry. There’s likely a local Chamber Affiliate in your area.
All of the organizations listed above do have a membership fee, in some cases, on par with the cost of NGLCC membership. However, becoming a member of your local LGBT Chamber Affiliate is kind of a two-birds-with-one-stone approach, in which you’ll get the benefits of being part of a local organization, as well as the fee waiver for the benefits of having national certification, as well.
Ready to Apply?
You’ll still need to dot your i’s and cross your t’s. If you’re going the route of applying through one of local organizations above, be sure to reach out to them first before you begin the Certification process. They should have a lot of institutional knowledge you can benefit from. If you’re doing this on your own, then you’ll need to create a profile and begin the application process directly with the NGLCC.
Once you submit your application for LGBT business certification, you can expect a few months to pass before you’re officially certified. While you’re waiting, the NGLCC, in the person of a Regional Representative, will conduct a site visit to your business to ensure that you do indeed meet the criteria. Although this may seem burdensome, without such strict guidelines and verification, your final certification wouldn’t carry the power and weight it does.
LGBT business certification is a process, but a worthwhile one for LGBT business owners who want to be involved in ensuring economic equality and contribute to the conversation about economic issues affecting the LGBT community.
**The application process can be rigorous, but NGLCC wants to help. If you need more information, the organization provides a contact at firstname.lastname@example.org, or 202-234-9181, for those with further questions around Certification as an LGBT Business Enterprise.
Image courtesy of Pimpinellus, Wikimedia Commons