How to Move Up and Become Part of the Supply Chain to Larger Companies

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by Caron_Beesley, Community Moderator

Created: February 28, 2013, 9:59 amUpdated: February 28, 2013, 9:59 am

Looking for ways to become a supplier to a larger company?

A recent study showed that after a small supplier lands a big purchase order or a contract from a bigger company, the small company’s revenues go up 250 percent and they create about 150 percent more jobs in just two or three years. This is a great opportunity both for small business and for the economy.

But how can a small business go about landing a contract to be part of this lucrative business growth opportunity? Here are some tips, tools and resources that can help you get there.

Do Your Research And Plan Your Strategy

Breaking into a new market or new client base requires planning. This blog offers some tips for finding larger companies that would be a good fit for your business; getting that important first meeting; refining your sales pitch; and alleviating any perceptions about your “small” business status: How to Up the Ante and Start Selling to Larger Companies.

Use Available Resources – #1: “Supplier Connection”

Large U.S. multinational companies also know the value that supply chain networks have for them and their customers and have strengthened their efforts to reach out to small suppliers. For example, several large firms have come together to create a single, standard online application – called the Supplier Connection – that allows small suppliers to market themselves to many large U.S. firms at the same time. These firms include Office Depot, Bank of America, Dell, Facebook, Kelloggs, UPS, Pfizer and more.

The Supplier Connection portal is open (free of charge) to U.S. small businesses that have less than $50 million in revenue, or have less than 500 employees and that provide the following goods or services:

Facilities supportFood and beverage manufacturingIndustrial manufacturingLab supplies and equipmentLogisticsProfessional, marketing and technical servicesService partsSoftware

The program is part of the Obama Administration’s American Supplier Initiative, which was created to encourage companies to use small businesses as suppliers. Check out the Supplier Connection website for more information. These FAQs are also a useful resource.

Use Available Resources – #2: Your Network and Assistance Programs

Tradeshows and industry conferences are a great way to network and meet potential customers. Even if you don’t have the budget to exhibit yourself, simply attending can provide a great venue to meet the bigger players in your industry or target market. Here are some tips for getting the most out of these events: Got a Trade Show to Go To? Make it Pay Off for Your Small Business.

Other avenues to explore include your local Chamber of Commerce or Small Business Development Center (many host events and networking sessions that showcase larger companies in your region).

If you need one-on-one help or counseling, consider a free mentor from SCORE. These folks have walked in your shoes, whether as business owners or executives, and can help you formulate and execute a growth strategy into new markets.

Don’t Forget the Largest Customer of All - Selling to the U.S. Government

The largest purchaser in the world just happens to be the U.S. federal government, which plays a major role in fostering the growth of supply chains filled with innovative small businesses. You can read more about the ins and outs of this market opportunity from the SBA here, the agency also offers several online courses that can bring you up to speed on how to sell to the U.S. government. Another option is to partner with businesses that already hold or are bidding on government contracts. This process, known as sub-contracting, provides a useful point of entry into this market (which operates quite differently than the private sector).

The government also offers programs that help specific business groups such as veteran-owned businesses, women-owned businesses, and others, gain access to the federal marketplace.

These blogs also offer insight into the business of selling to the government:

Caron Beesley is a small business owner, a writer, and marketing communications consultant. Caron works with the SBA.gov team to promote essential government resources that help entrepreneurs and small business owners start-up, grow and succeed. Follow Caron on Twitter: @caronbeesleyTags: Community Blogs, Small Business Matters, Managing

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SBA Has a New Initiative to Help Veterans Access Capital and Become Entrepreneurs or Expand Existing Businesses

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Are you a veteran transitioning from active service and want to become an entrepreneur? Or perhaps you’ve been out of the service for some time and want to start a new small business or expand an existing one?

If that’s you or someone you know, the U.S. Small Business Administration (SBA) has announced the SBA Veteran Pledge Initiative, a new commitment by its top national regional and community lenders to collectively increase their lending activity to veterans by five percent per year for the next five years. This initiative has the potential to boost the already $2.1 billion per year in lending support that various SBA programs provide to new and existing vet small business owners.

I’ve heard stories that many veteran entrepreneurs face challenges in raising capital or have trouble receiving a conventional loan. This is why getting out the word about this new initiative is so important.  With the support of SBA’s top 20 national lending partners, and approximately 100 additional regional and community lending partners across the United States, SBA expects to assist an additional 2,000 veterans obtain loans to start or expand small businesses by increasing lending by $475 million over the next five years.

The combined goal by the top 20 national lending partners’ will provide nearly $249 million of lending, potentially impacting nearly 800 veteran entrepreneurs. The five percent increase in lending by approximately 10 lenders in each of the 10 Regions will account for the remaining $226 million in loans and more than 1,100 additional veteran entrepreneurs assisted.

I know that if we support our veteran entrepreneurs, and provide them with the tools they need, they will have a higher chance of success.  Already, veterans make up a large number of successful small business owners.  Nearly one in ten of small businesses are veteran-owned.  These 2.45 million veteran-owned businesses employ more than 5 million individuals.  In the private sector workforce, veterans are more likely than those with no active-duty military experience to be self-employed. 

I just have to echo SBA Administrator Karen Mills, speaking recently at Ft. Bragg, North Carolina, who said “Our service men and women have made incalculable contributions and sacrifices for our country, and supporting them as they pursue their dreams to start or grow their own business is one of SBA’s highest priorities. Through this partnership with national lending partners and regional lenders across the U.S. we stand ready to serve veteran entrepreneurs with loan- guarantees, entrepreneurial training, and resources that are critical tools to help them start businesses, drive the local economy and create jobs for themselves and their communities.”

So for all of you aspiring and existing entrepreneurs, if you need capital for your small business, please call one of SBA's 68 local district offices, or one of its 15 Veterans Business Outreach Centers nationwide.

SBA’s resources for veterans, and its partnership with 1,000 Small Business Development Centers and some 12,000 SCORE-Counselors to America's Small Businesses volunteers, help more than 200,000 veterans, service-disabled veterans and reservists each year. 

To learn more about additional opportunities for potential and existing veteran small businesses, visit the website at www.sba.gov/veterans. 

Rhett Jeppson is the Associate Administrator for SBA's Office of Veterans Business Development.Tags: Official SBA News and Views, Open For Business, Financing, Managing, SBA News and Views, Starting

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