Government contracting and small business development

Big organizations, be they government or private sector, generally contract with big organizations. Certainly in the private sector, the issue is reducing the number of vendors overall, having massive contracts covering a nation's worth of sites, etc. (E.g., Trammell Crow, the real estate management and development firm, has a contract to maintain and manage the property of Bank of America, including all their individual branches nationwide.)

Yesterday's Post has an article, "Big Name, Big Deeds Fall Short in D.C. Contract Bid," about the inability of a local organization, which doesn't yet have a track record in vehicle fleet management, to get the contract to manage the Police Department fleet. The company thought that their local connections should have meant that their bid should have been considered.

Big governments could assist the ability of smaller businesses to be competitive for contracts such as these, if they broke the contracts up into smaller pieces, but that would counter the trend of big organizations contracting with ever bigger organizations.

An example would be if the city were to contract out trash collection. If you make it a city wide contract, likely only the biggest firms in the U.S., and there are only a couple, would be able to make a credible bid.

But if you broke up the contract by Ward (there are 8 wards in the city), or quadrants (4, although the SW quadrant is microsized), you provide the opportunity for much smaller companies to make credible proposals, and to be able to execute the contract at high standards.

This is how you build up smaller businesses, and provide a framework within which they are able to grow.