How Cleveland is Assisting Very Small Businesses with Contracting in the City

How Cleveland is Assisting Very Small Businesses with Contracting in the City

On May 16, 2019, after Mayor Jackson learned of Cleveland’s grant award from Living Cities and Citi Foundation to participate in City Accelerator’s second Inclusive Procurement cohort, he announced, “There are billions of dollars of development happening in our city. However, now it is time to take the next step. We will establish wealth creation by expanding current efforts and creating a sustained model of procuring and sourcing within the local economy.”

A strong agenda of equity has always been the foundation of Mayor Jackson’s leadership. At the conclusion of his fourth term in 2021, Mayor Jackson will be known as the longest serving mayor in Cleveland. He came into his current seat with the mission of “serving the least of these.” This focus is actualized under his prescribed philosophy of “Self-Help”; a three-fold strategy of prioritizing investing, buying and hiring within the City of Cleveland. This philosophy serves as a reminder of the importance of placing Clevelanders first through an inclusive, local workforce perspective.

Dr. Burrows, Director of Mayor’s Office of Equal Opportunity, learned about the City Accelerator Inclusive Procurement cohort and grant opportunity in the Fall of 2018. At the time, the City’s disparity study was approaching its sixth year, and Dr. Burrows was thinking of ways the department could implement remaining items from the study. She had several internal conversations with other departments and the Mayor, where she heard about upcoming contracting opportunities. It was through these conversations that she learned of the City Accelerator cohort application.

Cleveland’s acceptance into the City Accelerator cohort was an opportunity to continue working towards the City’s long-term goal of gaining a larger and more diverse pool of prime and sub-contractors for projects, along with creating generational wealth for Cleveland’s contractors.

Conversations with the City’s contractors highlighted that the biggest challenges for local entrepreneurs are the same for most MBEs, including: capital and credit issues; limited cash flow; contract sizes too large to manage; and lack of bonding capability. It was no surprise to learn of these barriers, which have been validated in various disparity studies and through a survey of local entrepreneurs.

Through implementation of the Small Contractor Rotation Program, Cleveland expands the City’s contracting ecosystem. Specifically, the rotation program builds capacity for both existing and potential businesses with implementation of the Division of Purchases and Supplies’ CGI Vendor Self Service System.

The CGI Vendor Self Service System (VSS) is for all competitive bids under $50K. This new and innovative system streamlines the procurement process citywide. It allows vendors access to bid on commodity and services electronically, and sends questions to pre-registered vendors when new contracting opportunities become available. Additionally, VSS speeds up the contracting process by reducing the time to issue purchase orders to vendors; eliminates the time buyers spend preparing routine public records request for bid tabulations as the information becomes available online; and reduces human error during the evaluation process.

The Small Contractor Rotation Program’s (SCRP) foundation is built on a race and gender-based initiatives designed to provide capacity building and assistance to small contractors. It will help subcontractors transition into prime contractors through experience with working on contracts. The SCRP provides small contractors with the ability to compete for City business, while taking a “deeper dive” into their business by taking classes in marketing, estimating, financing, bonding and more.

Prior to COVID-19, the City of Cleveland anticipated classes being taught through online, webinar style format to allow small contractors to participate remotely from any location. With the kickoff meeting held in February, no one knew how imperative it would become to go online. So far, all classes, except one, have been held with 10 to 15 attendees on average.

Celeste Lawson is one business owner that’s attended each class. The Lawson Business Group, LTD is a small general construction firm specializing in residential rehabilitation and design. Lawson is participating in the SCRP as a way of better understanding how to run her business effectively and efficiently. Ms. Lawson is interested in learning more about customer service, estimating, and bidding for both public and private sector contracts.

According to Ms. Lawson, “I am very happy I chose to apply for the program. My experiences have been great thus far. Even in this short amount of time I have been able to implement some of the strategies I’ve learned from the classes related to the importance of realizing your customer base and target market, as well as, having the right insurance company that understands your scope of business and what your future goals are for your construction business.”
Additionally, Ms. Lawson agrees that, “this program is essential for any small construction firm looking to grow and gain insight on how to be successful in the construction industry.”

Small businesses and contractors, especially contractors of color, have borne the brunt of COVID-19’s economic crisis. While we, as city and nation, work actively to pursue ways of rebuilding our economies during COVID-19, Cleveland is focusing on small contractors and strengthening opportunities for the small businesses in the CLE. Supporting small businesses and contractors is central to our strategy for recovery and long-term wealth building for entrepreneurs in Cleveland.

Photo Credit: City of Cleveland Photographic Bureau

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