TERRI L.C. HORNSBY, a Houston entrepreneur, splashes corporate logos on golf balls, T-shirts and coffee mugs and sells them to Fortune 500 clients using the pitch "image is everything." But in order to snag big business, Hornsby had to promote another image first: her own.

Hornsby, an African-American, was quick to realize her ethnic background and gender could help her pursue contracts with local oil giants Shell Oil, Halliburton and ConocoPhillips. Shortly after launching TLC Adcentives out of her home in 1995, she had her business certified as minority- and woman-owned, and credits the distinction with landing her business on Corporate America's radar screen.

Now, "I get a lot of face time with corporations that are outside the city of Houston," says Hornsby, whose client list also includes Hewlett-Packard. "It's given me the opportunity to go after those national contracts."

Like many entrepreneurs, Hornsby has tapped into a rich vein commonly known as "supplier diversity" programs in the world of big business. Many corporations set aside millions of dollars in vendor and procurement contracts to small businesses that have been certified as minority- or woman-owned. Some corporations include veteran- and disabled-owned businesses in their supplier diversity programs, while others such as IBM and Cendant include lesbian- and gay-owned businesses.

For the right certified small business, that means an enticing chunk of cash is available. Xerox, for instance, has purchased more than $4.7 billion in goods and services from qualified businesses since 1985. AT&T's supplier diversity program, active since 1968, has directed $16.5 billion toward ethnic and female suppliers. Wal-Mart's supplier diversity program, begun in 1994, has grown from $2 million initially spent with minority- and women-owned businesses to more than $2.9 billion.

Many small businesses, however, have not taken advantage of supplier diversity programs, in part because certification can be confusing and time-consuming. The National Minority Supplier Development Council (NMSDC) is the largest third-party certifier of Asian, Black, Hispanic and Native American businesses, while the Women's Business Enterprise National Council (WBENC) certifies women-owned businesses. The Small Business Administration and some state and local government agencies certify minority enterprises and women-owned small businesses, often through programs for what they call "economically or socially disadvantaged" businesses.

To become certified, a business owner must submit financial records such as bank documents, tax returns and a profit and loss statement, and provide proof of majority ownership by a minority or woman. Eligibility is determined after interviews and site visits. Both NMSDC and WBENC charge a processing fee, typically about $250, for the certification, which must be renewed each year.

Corporations that have supplier diversity programs require certification in order to prevent fraud and to prove that they are using diverse suppliers, especially in instances where government contracts mandate that a portion of business be directed to minority- and women-owned firms.

Some entrepreneurs consider the certification process too intrusive while others are loathe to seek special treatment for their ethnic background or gender, says James Lowry, a marketing professor at Northwestern University's Kellogg School of Management. Some minority-owned firms don't want to be labeled as such, out of concern that stereotypes could hold them back, he says.

Certifying Your Small Business

National Minority Supplier Development Council
Certifies and matches more than 15,000 minority-owned businesses (Asian, Black, Hispanic and Native American) with 3,500 corporations, universities and hospitals that want to purchase goods and services. To qualify, the business must be at least 51% owned, operated and controlled by a member of a minority group. The NMSDC has a national office in New York and 39 regional councils across the country. A combination of screenings, interviews and site visits establishes eligibility; applicants must pay a processing fee that varies by region and size of firm, typically $200 to $500.

Women's Business Enterprise National Council
Certifies 5,400 women-owned businesses with more than 700 major corporations across the country and also a number of federal and government agencies. To qualify, the business must be 51% owned by a woman or women, and provide proof of effective management of the company. WBENC has 14 partner organizations across the country that handle WBENC certification in all 50 states. During the certification process, a committee reviews the applicant's documents pertaining to the company's legal and business structure, and conducts an on-site visit. The fee ranges from $250 to $350 depending on where the business is located.

But the benefits of certification are too great to pass up, particularly for entrepreneurs who also take part in NMSDC's and WBENC's regional networking and educational programs, he advises. "I've seen companies grow tremendously in a very short period of time," says Lowry, also a senior vice president at Boston Consulting Group who has helped corporations design supplier diversity programs.

So what's in this for the large companies providing these programs? Oftentimes it's a chance to market to a segment of the population they're interested in targeting. It's also a way for corporations to build wealth or promote economic development in underserved communities that may be a future customer base.

"We buy from minority- and women-owned suppliers in an effort that they will buy our products and services, so we both can enrich each other," says Jethro Joseph, senior manager of diversity supplier development at DaimlerChrysler. "That's the whole business basis of what we do."

DaimlerChrysler has directed more than $30 billion to minority-owned businesses since its supplier diversity program began in 1983, Joseph says. That figure doesn't include contracts to women business owners, which the company didn't track until more recently.

DaimlerChrysler works with small businesses that provide a variety of services including technology information services, advertising, and of course, manufacturing. "A typical vehicle has 20,000 parts," Joseph says. "A minority supplier can provide any of those parts."

The certification by no means guarantees that a small-business owner will land a lucrative contract with a Fortune 500 client. But it provides access — a foot in the door — to big corporations' supplier diversity programs.

"Marketing is the key reason to get certified," says Susan Bari, president of WBENC. "It's a tool, like any other marketing tool."

Entrepreneurs, especially those just starting out, often seek businesses with small regional companies rather than shooting for contracts with big corporations. "The certification allows you to wave your flag a little more broadly, and to an audience who can do more for you," she says.