What is an MBE?

In the current business landscape, you may frequently encounter the acronym MBE. In this context, MBE stands for Minority Business Enterprise which is defined as a business that is primarily owned and operated by American citizens of minority descent. For the purposes of this certification, a minority is generally defined as a person who is African American, Hispanic American, Asian American and Native American. Currently there are numerous minority owned businesses in multiple industries that have earned this title and that are operating as verified MBEs. In this article, we will further detail minority business enterprises and the benefits that can be gained from becoming a certified MBE or sourcing a minority owned business for services or products.

A Brief History of Minority Business Enterprises

The history of minority business enterprises and their development goes all the way back to 1969 with an Executive Order signed by President Nixon. This Executive Order created the Office of Minority Business Enterprise and the Advisory Council for Minority Business Enterprise. In the inaugural year of the program, these agencies partnered with the Census Bureau to survey Minority-Owned Business Enterprises across the U.S.. Sparked by the first Executive Order, numerous Executive Orders followed that expanded and developed the Minority Business Enterprise program and the supporting organizations. Today, the Minority Business Enterprise Program is led by the Minority Business Development Agency. Additionally, minority owned companies must now go through a thorough certification process to operate under the title of MBE and participate in the resulting benefits. Additionally, the MBDA and Census Bureau continue to partner in studying the development of minority-owned businesses. A recent study by the MBDA and the U.S. Census Bureau was performed in 2010.

How To Get Certified

The MBE certification process, put forth by the MBDA, involves completing a pre-qualification form, an application, a site inspection and an inspection of operational, personnel and accounting practices. This certification process is somewhat involved and the MBDA is very stringent about its qualifying guidelines. In fact, if it is found that a business is not minority-owned and operated, that business may be served with civil and criminal penalties for making fraudulent claims. In addition to the certification process offered by the MBDA, there are other certifications available to minority business enterprises including by the Department of Defense and the National Minority Supplier Development Council. A business that is looking to become MBE certified should consider these additional certifications to gain other benefits.

Benefits of Becoming an MBE

There are numerous benefits to becoming MBE-certified including access to resources provided by the supporting organizations and other incentives. Review a brief list of these benefits below.

  • Numerous opportunities in sales and marketing efforts
  • Access to a business mentoring program
  • Access to additional educational programs and resources
  • Technical assistance
  • Financial assistance and support opportunities
  • Access to national and international business partnerships and MBE contracts

Benefits of Sourcing MBEs

There are also many benefits to sourcing minority business enterprises for services and products. These benefits include federal tax incentives and more. Review a brief list of the benefits of sourcing MBE below.

  • Federal tax incentives
  • Tax liability incentives
  • State tax incentives
  • Federal rebates
  • Supplier diversity

Due to the various incentives and benefits, your business should consider sourcing a minority-owned business for services or products. Also, if your business meets the qualifications, you may want to consider becoming an MBE. There are numerous incentives to pursuing both of these avenues. Pipestone Property Services, is a notable example of a certified minority business enterprise. As a corporation that is wholly owned by the Lower Brule Sioux Tribe of South Dakota, Pipestone Property Services holds multiple MBE certifications. As an MBE and Tribal Corporation, Pipestone Property Services has provided local, regional and national companies with quality services that are federally incentivized. For more information about minority business enterprise certification and supplier benefits, consider returning to this blog for follow-up posts. For more information about Pipestone Property Services their MBE certification and building maintenance services, visit http://www.pipestone.biz.

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