PASADENA, Calif. -- Because they speak little English,
Arturo and Graciela Guerrero have had poor luck making deals with
government agencies and aerospace giants for their small company
to make parts for aircraft, military vehicles and tanks.
But their 20-year-old daughter, Rosalie, who took
over the sales operations of this 10-employee company in Ontario,
Calif. right after high school, found a way to win face-to-face
time with corporate executives and government officials: "speed
dating" services for small businesses.
Such business matchmaking is a twist on the traditional
trade show -- it mimics its romantic counterpart by giving small-business
owners 15 minutes with contracting executives before a bell rings
and they switch chairs to meet the next person. The U.S. Small Business
Administration program is intended to help the country's 25 million
small businesses connect with big companies and government agencies.
The SBA says that about $30 million of contracts have been struck
through the program since its launch last year.
The program been drawing heavy interest in particular
from one corner of the small-business world: minority contractors,
often immigrants, who find it difficult to win business because
of language, cultural and bureaucratic barriers. At a recent business
matchmaking event here, 57% of the 1,000 small businesses looking
for work were minority owned. About 40% were owned by women.
At that event, contract seekers were herded in groups
at their appointed hour into a large hall with 200 small tables
lined up close together. In the short time allotted, some business
owners gesticulated wildly as they promoted their services while
others calmly pointed to brochures outlining their operations. The
pace sometimes was frenetic -- with the sound of a bell, the business
owners shifted to the next seat while the executives stayed in place
-- but others were able to get breaks between presentations. Businesses
and contractors of different industries participated, but were grouped
separately. Both sides were prescreened to match services with requests.
The younger Ms. Guerrero made a pitch to Northrop-Grumman
Corp. while her mother waited on the sidelines. She presented homemade
brochures, discussed the capabilities of the family business, South
Precision Machining, and reminded the executive that they had done
work for Northrop-Grumman before.
Northrop-Grumman wasn't to be a match. The executive
told her the company didn't want to outsource manufacturing only;
it wanted component design as well, a task South Precision Machining
wasn't equipped to handle. After a break, Ms. Guerrero continued
with her next meeting. Participants, including Ms. Guerrero, averaged
six or seven presentations over two days.
Shah Rizvi, an immigrant from Pakistan who runs his
own engineering company, made progress at the event. He said he
had previously tried to reach companies like Agilent Technologies
Inc. and Hewlett-Packard Co. to no avail. He didn't sign any contracts
that day, but he made contacts, even one at H-P, he says. "Sales
is basically a game of numbers, the more people you talk to, the
more people you have a chance of working with," he says.
Small business owners are often shut out of the information
loops they need to be in -- they are unaware of bidding opportunities,
or even what is required to solicit work, says Ralph Bangs, associate
director of the University of Pittsburgh's Center on Race and Social
Problems.
"If you don't have social networks, whether it be in contracting
or for job opportunities within an organization, you often miss
out because people have a tendency to look at what's familiar to
them," says Katherine Phillips, a professor at Northwestern University's
Kellogg School of Management.
The experience of the Guerrero family shows that
the matchmaking program, while an opportunity, isn't a cure-all.
The couple came from Mexico about 30 years ago, and Mr. Guerrero
picked up the machining trade to support a family that grew to include
five children. The Guerreros started South Precision Machining in
2000 -- Mrs. Guerrero is chief executive and her husband is the
programming/operations manager.
The Guerrero's company has manufactured parts for
Lockheed Martin Corp., Boeing Co. and Northrop Grumman in the past,
but it never won direct contracts. Instead, it got work through
middlemen who the Guerreros say often fall behind in paying them
-- if at all -- because they know they can't afford a lawyer to
take legal action or hire a collection service.
Now, the matchmaking program is putting Rosalie Guerrero
across the table from representatives of Northrop Grumman and Raytheon
Co. "The opportunities are out there, but it's just that we can't
get to the right people," she said.
South Precision Machining didn't sign a contract
that day, but it landed another sort of deal. A few days later,
a former SBA official, who Rosalie Guerrero met at the event, offered
to help with paperwork to certify the machine shop as a minority-owned
business that is economically disadvantaged. Earlier consultants
had quoted figures as high as $3,000 to do the work, but Ms. Guerrero's
new contact did it free of charge.
Though it was only her second conference -- the first
one was a traditional trade show a week earlier that cost her $400
-- Ms. Guerrero wants to go to the next matchmaking event in Milwaukee.
"You feel that contacts can remember you and you don't find too
many events that are free," she said. (Business matchmaking services
run by the SBA are free.)
Despite bureaucratic barriers, some corporations
are open to the idea of awarding contracts to minority and women-owned
businesses. Both H-P and AMR Corp.'s American Airlines run supplier
diversity programs that look to minority-run businesses for procurement
needs. The federal government targets 23% of the total funds up
for contracts go to small businesses.
"Through these events, we have found suppliers that
have amazing prices and services which give us a competitive match
that we would never find any other way," said Christina Hanger,
a senior vice president at H-P. "While it's true that big companies
do have advantages, many times they may not be as agile and they
may not have as innovative solutions."
Government agencies and corporate executives cautioned
that they rarely offer deals on the spot and that potential partners
still must undergo the bidding process.
Even if small businesses don't get a lucky break
right away, the contact can lead to a future business relationship.
After attending an event last summer in Anaheim, Calif., Walter
Johnson, a vice president at minority-owned engineering firm Pacific
Crossing, signed two contracts worth about $1.5 million. He's also
tacked on $5 million in contracts with three divisions of Northrop
Grumman, a company he first made contact with through the matchmaking
service. "The companies that attended really seemed to have a commitment
to doing business with small businesses," Mr. Johnson says.
Corrections & Amplifications:
The U.S. Small Business Administration's program
to help small businesses connect with big companies and government
agencies was started in 2002. This article incorrectly stated that
the program was launched last year.