Major Leagues
Small businesses score big by teaming up with the giants.
Texas entrepreneur Diva Garza knows that if you slam a door in
the face of opportunity, it's not likely to knock again. So
when she was approached by a much larger competitor about teaming
up as a subcontractor on a project, she pushed aside her
reservations and signed on.
"I was pleasantly surprised," remembers the owner of
International Team Consultant Inc. Personnel Services. "It
turned out to be a great relationship. I found out that when you
team up with a competitor, particularly a larger one, there has to
be mutual respect, lots of trust and good chemistry."
Garza's decision to join forces with Kelly Temporaries three
years ago helped her establish a relationship with a Fortune 500
corporation--Shell Oil Co.--to which she had been trying to sell
for almost five years. As the Houston business owner learned,
subcontracting and selling to private companies offer lucrative
opportunities for small businesses seeking to expand their customer
base.
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The line between selling and subcontracting is a fine one.
Selling directly to corporations as a supplier or vendor typically
involves either a onetime sale or an ongoing relationship where
goods can be exchanged at any time. Subcontracting usually involves
working for a specified time with a company that has a contract for
a specific project. Suppliers can easily become subcontractors, and
vice versa. What makes both relationships so valuable is that they
allow you to get your foot in the door with not only that
corporation but also other large companies it does business
with.
But before you race down to the nearest big company, there are a
few things you should know--not the least of which is the sometimes
confusing terminology. Companies selling to big corporations could
be called vendors, suppliers or strategic partners; the departments
you'll need to contact may be called supplier diversity,
supplier development, purchasing, materials management, supplier or
supply management, and even sourcing.
Another thing to keep in mind is big corporations are
downsizing--not just employees but suppliers and subcontractors as
well. "We've been working for the last three to four years
on reducing our supplier base," says William Blue, manager of
the Supplier Diversity Program at Dupont. In today's
marketplace, winning a coveted subcontract or supplier contract
with a corporation means you have to work that much harder.
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