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Round 'Em Up

More clients, money and prestige. Entrepreneurs have plenty of reasons to pursue subcontracting opportunities.

This story appears in the August 1998 issue of Entrepreneur. Subscribe »

The decision to become a subcontractor is perhaps an easy one to make--but as any seasoned entrepreneur will tell you, securing that coveted contract is an entirely different story. That's because the subcontracting process itself--from the initial invitation or query to contract award--often involves a tangle of complexities, any one of which can deter even the most ambitious amateur. From increasing global competition to Fortune 100 vendor consolidation, challenges run rampant. But the good news is, small businesses can learn to compete--and win.

According to the most recent figures from the National Association of Purchasing Management (NAPM), an organization for purchasing and supply management professionals, 54 percent of its members spent between $1 million and $10 million on purchasing in 1996, and 10.4 percent of its members surpassed the $50 million mark. That means subcontracting is and will most likely continue to be big business for entrepreneurs, despite the challenges involved. The advantages of a successful subcontracting relationship are more than worth the effort: You'll gain invaluable experience, expand your business, and open the doors to more big business and government contract relationships.

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