Fuel small business – fuel the economy

Small businesses are the driving force behind a strong U.S. economy. More than 60 to 80 percent of all new jobs come from small businesses. According to Jim Clifton, author of The Coming Jobs War, there were about 6 million businesses in the United States with at least one employee, as of 2007. Businesses with 500 or fewer employees represent more than 99 percent of these 6 million. Contrary to popular opinion, it is not jumbo corporations that run and dominate the economy, but small and mid-sized companies.

Political officials across the country are putting the full-court press on procurement organizations to level vendor playing fields and encourage small to mid-size company growth. Vendors, regardless of size, should have an equal opportunity to supply goods and services to the public sector. Economic development offices are implementing new initiatives and calling for legislation to stimulate small business growth. State and local governments are issuing “set-aside” procurement opportunities for small business.

The State of Maryland understands the impact its economic engine has on small business and revamped their eMaryland Marketplace to improve the landscape for these businesses to compete. Maryland worked with Periscope Holdings to deploy BuySpeed’s new Small Business Engine (SBE). The new automated engine qualifies and certifies vendors as small business participants within the eMaryland Marketplace during on-line vendor registration.

In addition, all Maryland vendors now register with the NIGP commodity code, which helps the state understand which vendors supply what goods and services. With the SBE, Maryland not only certifies small businesses but can now also use the NIGP Code to report on the specific goods and services that are provided by small business vendors. Maryland’s eMarketplace provides a one-stop-shop for vendor registration, small business certification, solicitation management and contract management. The state expects to revive small business involvement through its consolidated paperless vendor qualifying system.

“Maryland has opened a new door into small business involvement,” said Maryland Gov. Martin O’Malley. “This new tool helps the state accomplish our economic development strategy to generate, grow and sustain the state’s economy from within.”

Maryland went live with SBE functionality on February 20, 2012, and already has more than 4,500 small businesses registered in the eMaryland Marketplace. Small business opportunities have increased two-fold. Since go-live, an average of 246 new small businesses have enrolled weekly. Forty-six percent of all vendors now registered in eMaryland Marketplace are qualified small businesses.

Maryland’s BuySpeed Small Business Engine, allows the state to:

• Set configurable vendor qualifying questions
• Certify small business within the system, thus eliminating paper affidavits and certificates
• Identify small business vendors and extend invitations to participate in set-aside procurements
• Track contracts awarded to small businesses
• Monitor small business involvement goals
• Send renewal notifications to vendors
• Report expired and renewed small business vendors

Small businesses are not the only classification that can benefit from the small business engine module. The flexible nature of the rules-based engine can be used to promote local, minority, women and veteran-owned businesses.

“Political officials nationwide are instituting programs to stimulate categorical business participation; however, most governments lack a way to manage new policies,” said Brian Utley, President and CEO, Periscope Holdings, Inc. “We’re pleased to have successfully worked with Maryland to level their vendor playing field with BuySpeed’s one-stop-shop for vendor registration, solicitation management, contract/catalog management and small business certification.”

When small businesses grow, the government tax base grows. When small businesses shrink, the government tax base shrinks, slashing entitlements and government programs. Small businesses are looking for every opportunity to prosper. Today’s economic headwinds have small, medium and large businesses fiercely competing for public sector contracts.

Small business initiatives are great in theory; however, historically someone had to certify, track and monitor participation. Ultimately, that responsibility has fallen on procurement, and the concern over how to manage new initiatives becomes a reality. Who qualifies as a small business? How am I going to verify small business compliance? How do I track awards? The common response: I don’t have available personnel to oversee small business involvement.

Typically, procurement organizations have manually certified small businesses through paper affidavits and notarized documents. This tedious task was either outsourced or most commonly neglected leaving small businesses overlooked in favor of their large counterparts. In addition, most procurement systems are not integrated with vendor pools or solicitation processes, so categorical “set-asides” are difficult to execute. In the end, opportunities to spur small business growth are diminished because organizations lack an efficient way to manage small business involvement.

Success of Maryland’s enhanced marketplace demonstrates how strengthening small business vendor outreach can open bid opportunities in which it has previously been difficult for small businesses to compete.

Brittany Devine oversees product marketing for Periscope Holdings, Inc. Contact her at [email protected].