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How to Move Up and Become Part of the Supply Chain to Larger Companies

by Caron_Beesley, Community Moderator

  • Created: February 28, 2013, 9:59 am
  • Updated: February 28, 2013, 9:59 am
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8 comments

Looking for ways to become a supplier to a larger company?

A recent study showed that after a small supplier lands a big purchase order or a contract from a bigger company, the small company’s revenues go up 250 percent and they create about 150 percent more jobs in just two or three years. This is a great opportunity both for small business and for the economy.

But how can a small business go about landing a contract to be part of this lucrative business growth opportunity? Here are some tips, tools and resources that can help you get there.

Do Your Research And Plan Your Strategy

Breaking into a new market or new client base requires planning. This blog offers some tips for finding larger companies that would be a good fit for your business; getting that important first meeting; refining your sales pitch; and alleviating any perceptions about your “small” business status: How to Up the Ante and Start Selling to Larger Companies.

Use Available Resources – #1: “Supplier Connection”

Large U.S. multinational companies also know the value that supply chain networks have for them and their customers and have strengthened their efforts to reach out to small suppliers. For example, several large firms have come together to create a single, standard online application – called the Supplier Connection – that allows small suppliers to market themselves to many large U.S. firms at the same time. These firms include Office Depot, Bank of America, Dell, Facebook, Kelloggs, UPS, Pfizer and more.

The Supplier Connection portal is open (free of charge) to U.S. small businesses that have less than $50 million in revenue, or have less than 500 employees and that provide the following goods or services:

  • Facilities support
  • Food and beverage manufacturing
  • Industrial manufacturing
  • Lab supplies and equipment
  • Logistics
  • Professional, marketing and technical services
  • Service parts
  • Software

The program is part of the Obama Administration’s American Supplier Initiative, which was created to encourage companies to use small businesses as suppliers. Check out the Supplier Connection website for more information. These FAQs are also a useful resource.

Use Available Resources – #2: Your Network and Assistance Programs

Tradeshows and industry conferences are a great way to network and meet potential customers. Even if you don’t have the budget to exhibit yourself, simply attending can provide a great venue to meet the bigger players in your industry or target market. Here are some tips for getting the most out of these events: Got a Trade Show to Go To? Make it Pay Off for Your Small Business.

Other avenues to explore include your local Chamber of Commerce or Small Business Development Center (many host events and networking sessions that showcase larger companies in your region).

If you need one-on-one help or counseling, consider a free mentor from SCORE. These folks have walked in your shoes, whether as business owners or executives, and can help you formulate and execute a growth strategy into new markets.

Don’t Forget the Largest Customer of All - Selling to the U.S. Government

The largest purchaser in the world just happens to be the U.S. federal government, which plays a major role in fostering the growth of supply chains filled with innovative small businesses. You can read more about the ins and outs of this market opportunity from the SBA here, the agency also offers several online courses that can bring you up to speed on how to sell to the U.S. government. Another option is to partner with businesses that already hold or are bidding on government contracts. This process, known as sub-contracting, provides a useful point of entry into this market (which operates quite differently than the private sector).

The government also offers programs that help specific business groups such as veteran-owned businesses, women-owned businesses, and others, gain access to the federal marketplace.

These blogs also offer insight into the business of selling to the government:

About the Author

Caron_Beesley's Profile Picture
Caron Beesley is a small business owner, a writer, and marketing communications consultant. Caron works with the SBA.gov team to promote essential government resources that help entrepreneurs and small business owners start-up, grow and succeed. Follow Caron on Twitter: @caronbeesley
Tags: Community Blogs, Small Business Matters, Managing

Comments

sandhurst | Window Shopper | 5/20/2013 - 5:29 am

I really feel that another the "small" definition should indeed be for the
small companies, I do not think if i am a two man outfit i can compete with
someone who has 30million in revenue with 100 people working for them. Small
should in my opinion be less than 20 employees with less than 5 million
turnover. This is the sector that needs the most help. Since a company has
reached this plateau, it certainly means it has a good business model and
needs that extra boost.
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thanabal | Window Shopper | 4/19/2013 - 11:14 am

Thanks for reaching out about your recently moved comment on the SBA.gov Community. You'll note in the Rules of Conduct that to maintain quality of discussions, contributions that do not provide a substantive purpose or relevance will be removed. If you have additional commentary related to the discussion topic or blog post, you're welcome to post that along with your original comment. Thank you for your understanding and for joining us on the SBA.gov Community.

linka | Window Shopper | 4/11/2013 - 12:56 pm

Is the supplier connection portal is available for Germany and China ?
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benvanzee | Window Shopper | 4/4/2013 - 12:28 pm

There is one part of selling to large companies that this article doesn't
cover: their payment terms. Many large companies can be very slow payers
(60-90 days). Small businesses need to make sure they are prepared with
additional working capital when they start selling to larger companies.
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linka | Window Shopper | 3/8/2013 - 11:02 pm

Thanks for reaching out about your recently moved comment on the SBA.gov Community. Youll note in the www.sba.gov/community/discussion-boards/rules-conduct-and-disclaimer that to maintain quality of discussions, contributions that do not provide a substantive purpose or relevance will be removed. If you have additional commentary related to the discussion topic or blog post, youre welcome to post that along with your original comment. Thank you for your understanding and for joining us on the SBA.gov Community.)

Laura M | Window Shopper | 3/5/2013 - 9:24 am

Hey Caron,

Thanks for the advice. I've sent the link for the supplier connection to the
proper people here in the company and we'll give that a shot. We are a small
business that sells to many of the larger companies in the world, but
obviously we'd love to sell to ALL of the larger companies out there. The
problem is that most of them already have preferred vendors for specific
items and don't want to go through the process of changing the vendor on
file. Once we do become the vendor, they are more than happy with our
products and service and they continue coming back. It's getting them on
board that's the difficult part, let's see if the supplier connection
works... Thanks!
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clearthelot | Window Shopper | 3/4/2013 - 11:17 am

Hi, just wanted to say, I liked this article. Thank you! For UK Clearance Service This post was edited to remove a link. Please review our Community Best Practices (http://www.sba.gov/community) for more information about how best to participate in our online discussions. Thank you.
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Security Gates | Window Shopper | 3/2/2013 - 1:20 am

I have a friend who has this same type of business, he recently won a
contract from a fairly big company supplying coconuts. Economical, Quality,
Assurance in delivery, and a Back up plan should fortuitous event occur, are
what he laid in the table to his clients. Thanks for sharing ideas that you
could actually use out there, i learned a thing or two from this article.
Hope you can share more.
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Mlinda | Window Shopper | 2/28/2013 - 12:54 pm

Is the supplier connection portal is available for Europe ?
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JGabriel | Community Moderator | 3/11/2013 - 5:17 pm

Show Replied Text…
Is the supplier connection portal is available for Europe ?
The Supplier Connection portal is open to U.S. small businesses that have less than $50 million in revenue, or have less than 500 employees.