Obtaining SWaM certification in Virginia enables businesses to bid on local and state contracts that are set aside for small, women-owned, and minority-owned businesses. The Commonwealth of Virginia has committed to sourcing 42% of all state purchases through small, women-owned, or minority-owned enterprises. Each entity that the Department of Small Business and Supplier Diversity (SBSD) certifies as SWaM may bid for state and local opportunities that are off limits to non-certified companies.

Since 2013, Virginia’s SWaM program has helped companies expand their sales with the state and begin contracting with Virginia civic entities. During the 2023 fiscal year, state and local agencies sourced over $2.7 billion worth of services and supplies from SWaM-certified businesses, accounting for nearly 29% of all contracts tracked through the state’s online contracting platform. As Virginia continues to deepen its commitment to small and diverse businesses, the number of state contracts set aside for SWaM-certified businesses will likely continue to grow.

Does My Business Qualify for SWaM?

To apply for SWaM certification, businesses must qualify as either small, women-owned, or minority-owned under the Code of Virginia.

Businesses are considered small if their revenue has averaged under $10 million for the past three years, or if they employ less than 250 people. If a business meets either of these two criteria, it qualifies and is eligible to apply. However, if its owners hold interests in other privately held companies as well, then additional evaluation factors may apply. Ownership of multiple companies (including holding companies and property holding companies) can prevent certification if not properly addressed in the application.

Women-owned and minority-owned businesses qualify for certification if they are at least 51 percent owned by one or more women or minorities who are U.S. citizens or legal resident aliens. Applicants must demonstrate that both the management and daily business operations are controlled by the minority or women owners. Showing ownership and control can often be challenging, and sometimes requires amendments or minor changes to company organization.  Enterprises that were formerly owned, in part or whole, by non-qualifying individuals (often husbands or non-minority business partners) often require significant additional information to demonstrate that control has adequately shifted to the qualifying owner.

Even Non-Virginia Businesses can become SWaM Certified.

Businesses do not have to be formed – or even located – in Virginia to obtain SWaM certification. Enterprises only must show that their principal place of business is either in the Commonwealth or within a state with recognized reciprocity. A principal place of business is defined as the location where:

• The business maintains its headquarters
• Where the business's books and records are kept, and
• Where the natural persons who direct, control, and manage the business's day-to-day operations are located.

If some of these factors fall outside the eligible state, then SBSD has the discretion to determine the company’s principal place of business. Before applying, applicants must make sure their businesses can adequately demonstrate they meet the location criteria outlined above in their qualifying state.

Be Truthful, and Put your Best Foot Forward

When preparing an application, firm owners must be truthful with the Virginia Department of SBSD. Applicants should strive to make the strongest case for certification, but avoid exaggerations, omissions, or mistruths.

The SBSD is responsible for evaluating each business’s application for SWaM certification. Part of this process is reviewing each application to ensure it meets the criteria described in state code and regulation. Because Virginia has committed to investing taxpayer funds into SWaM-certified businesses, the Commonwealth has created specific legal provisions to encourage candor and honesty in SWaM applications.

One of the steps to apply for SWaM certification is that applicants must submit a signed affidavit affirming that the contents of their application are true and correct. Knowingly providing false or misleading information on an application can permanently cost an applicant their ability to obtain certification in the future. Moreover, making false statements on a SWaM application is a class 1 misdemeanor, and submitting false or fictitious statements in a commercial transaction with the Commonwealth is a felony. The state specifically reserves the right to refer untruthful SWaM applicants to the City of Richmond for prosecution.

While making the best case for themselves, applicants should be truthful and forthright when preparing their application and strive to avoid any appearance of deception. Doing so includes submitting accurate company organizational documents, ownership papers, and tax returns to make sure that the application accurately reflects how the company operates.

Conclusion

SWaM certification offers great economic opportunities to qualifying enterprises in and outside of Virginia. While the application process can be tricky, thorough preparation is the key to successful certification. Below are some publicly available resources for more information about SWaM certification and the application process.

Helpful Resources:

The Department of Small Business and Supplier Diversity

eVa: Virginia’s Marketplace

Code of Virginia

SWaM Certification Portal

List of Supporting Documents