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Speeches & Op-Eds

Supplier Connection Event

Speech Date: 
Thursday, March 22, 2012
Speech Location: 
New York, New York
As Prepared For: 
Karen G. Mills, SBA Administrator

Thank you, Stan, not only for that kind introduction, but for hosting us today.

Let me also thank the IBM International Foundation for its role in creating and maintaining the technical infrastructure of Supplier Connection.

It's an exciting and potentially game-changing resource for small businesses…and I want you to know how much we appreciate your hard work.

I also want to thank the 15 participating companies for teaming up to create this innovative public-private partnership. And it's great that Facebook has signed up as the newest partner.

I know Dick had to leave, but I want to thank him for taking time out of his very busy schedule.

Dick is someone who truly understands the global marketplace – and what it takes for the United States to remain competitive.

He's been a good friend to the SBA and to me – and I want publically recognize him for his efforts and those of Citi.

I actually was at an event yesterday evening where Citi announced a partnership with Small Business Development Centers.

The partnership will help Women and Minority-Owned Small Businesses get the certification needed to bid for more government and private sector contracting opportunities. So in many ways these announcements go hand in hand.

Let me also thank my friend Darlene Miller for being here today. Darlene is owner and CEO of Permac Industries. And she serves on the President's Council on Jobs and Competitiveness.

I also want to recognize all of you….

How many of you work for the large companies participating in Supplier Connection?

Then you already know the important role that your supply chain plays in your company's long-term global competitiveness, your ability to innovate and how quickly and effectively you can get goods and services to markets around the world.

How many of you own or work for a small business?

The 15 companies participating in Supplier Connection have a global supply chain of more than $300 billion.

And we want to make sure that more small businesses – just like you – can tap into these important supply chains.

It really is a win-win.

Supplier Connection makes large companies more competitive by giving them access to a diverse array of innovative suppliers – and it ensures that more small businesses are of part of commercial supply chains and can add additional revenue streams.

That's a proven formula for job creation.  

You've seen the data…but it's worth repeating:

After a small supplier secures a contract from a large enterprise their revenue grows on average 250% -- and as a result – that creates a 150% increase in jobs in just two or three years.

So what's the role of the SBA in Supplier Connection?

It's simple.

Supplier Connection is a centerpiece of our American Supplier Initiative, an Administration-wide effort to bolster our nation's supply chain.

Our goal is to build on the number of small businesses currently participating in Supplier Connection.

We manage the government's $100 billion supply chain for small businesses.

We understand these companies. We know their needs. And we know how to engage them.

Just yesterday, I personally sent letters to over 50,000 small businesses to let them know about Supplier Connection.

And we are also working with our district offices and resource partners around the country to ensure that more small businesses are aware of this exciting opportunity.

And the Memorandum of Understanding Stan and I are signing later today will formalize our joint commitment to increasing opportunities for small businesses in the commercial supply chain.

Let me tell you why I think this is so important.

Last week, I was in Vandergrift, Pennsylvania with Congressman Critz and Vandergrift's Mayor Lou Pureificato.

We visited a tool and die manufacturing facility called Carbi-Tech.

It's a family run business co-founded by Rhett Crooks and his wife, Carol, and a business partner.

Rhett is a tool and die maker by trade, but always dreamed of running his own business.

He worked with his local college -- St. Vincent -- which hosts a Small Business Development Center which we help fund, to get the tools he needed to write his business plan.

Today, Carbi-Tech has grown from a rented garage making spare parts to a 17,000 square foot facility that produces and supplies custom precision parts to General Motors.

Rhett employees 20 people, including his son, and he is looking to hire more. I asked Rhett what he needs to take his business to the next level. He said, without hesitation, being able to broaden his sales to more large companies. A resource like Supplier Connection is the perfect vehicle to make this happen.

I live on a college campus. And one of the ways we look at Supplier Connection is like a universal, or common, college application.

It cuts down on paperwork, on duplication and having to fill out different forms for different applications.

Ask any small business about the challenges of reaching large companies and you will get the same response.

They don't know who to contact or they can't expend the resources going after these businesses individually, if they are not sure it will bear fruit.

They simply don't have the manpower. Sometimes it takes decades of knocking on doors, just to get a meeting. Supplier Connection changes all that.

It gets you into the right door. 15 of them currently…..with one easy, streamlined process.

And we believe Supplier Connection can be an essential and powerful resource in a small businesses toolbox.

It's why Supplier Connection is part of the Administration's broader effort around strengthening small- and medium-size manufacturers.

I am leading this effort for President Obama.

We call it the American Supplier Initiative. It is a call-to-action to the private sector to invest in their supply chains through small businesses. And it is designed to address some of the challenges facing small businesses today – and to make sure they have the capacity, the skills and the resources to effectively work with large corporations.
 

Let's very quickly look at some of these challenges and what we are doing:

The first, which we have talked about is, Access to Markets.

Whether its commercial supply chains, government contracting opportunities or lucrative export markets, small businesses often lack the resources and relationships needed to navigate these markets.

In addition to Supplier Connection, we are working on a range of portals across the Federal Government to make accessing these markets easier for small manufacturers.

These include Sub-Net, which we developed at the SBA. It's a tool that allows small businesses to search for Federal subcontracting opportunities with large prime contractors.

The Departments of Defense and Commerce also are working on portals that will provide small businesses and manufacturers increased access to supply chain opportunities.

And we are convening conversations across the Federal Government to build on these efforts. 

Business Capacity: We know that small businesses don't always have the experience they need to be successful suppliers.

At the SBA, we have a network of 900 Small Business Development Centers. 110 Women's Business Centers. And 12,000 participants in our Score Network. Last year, these programs reached more than 1 million small business owners.

Access to capital: We know many small businesses lack the capital needed to be a reliable supplier.

We are working to change that. And I'm going to brag a little. In 2011, SBA had a record year. We provided more than $30 billion to more than 60,000 small businesses.

Workforce Skills: This is one that always comes up when I visit manufactures. It came up when I was at Carbi-Tech.  They need trained welders and workers who understand precision metal machinery. And, frankly, they are having trouble finding them.

Across the Administration we are working to ensure that the next generation of U.S. manufacturing workers has the right training and education for advanced manufacturing jobs.

These initiatives are critical to our competitiveness and our long-term job creation efforts, particularly in manufacturing.

We look at the American Supplier Initiative as part of a comprehensive solution to grow small businesses, create jobs -- and to ensure that America has a strong, deep and diverse supply chain.

Over the last two years, we've created 3.9 million private sector jobs. For the first time since the 1990s, we're adding manufacturing jobs. We've created 440,000 good manufacturing jobs since 2010. This growth is being fueled by America's competitive advantage in innovation and our superior service. And we know that small businesses are playing a big part here. These are companies like Bottini Fuel who you will hear from in a minute.

Where's Rick? Rick's company provides fuel and helps service the backup generators at IBM's operations in Poughkeepsie, New York.  Poughkeepsie is one of the areas where IBM's cutting edge mainframes are developed and manufactured. So Rick is not only helping to power a major corporation in Hudson Valley. He is helping to power his local economy.

Small businesses create about two-thirds of net new jobs in the country. We also know that more than a third of all manufacturing employees work for a small business. And we know the multiplier effect that manufacturing produces.

For every one manufacturing job created, there are two or three indirect jobs created.

Our goal is to build on this momentum. According to a recent survey by the consulting firm Accenture, 60 percent of manufacturing executives are evaluating re-shoring options.

If we are going to bring more of this manufacturing back to the United States, we must build a more competitive and innovative supply chain of small businesses to provide goods and services to these companies.

We need a supply chain filled with more companies like Bottini Fuel, Havens & Company, Puritan Press and the thousands of small businesses we work with every day.

That's what the American Supplier Initiative and Supplier Connection are all about.

The founder of IBM, Thomas Watson, once said…."Yesterday, we pioneered for today. Today, we pioneer for tomorrow."

The consortium of businesses here today is doing just that: Pioneering for tomorrow by ensuring that America's manufacturing base can grow and flourish by harnessing the creativity and ingenuity of a robust supply chain of entrepreneurs and small businesses.

That how you create good middle class jobs and an America that is built to last.

Thank you.