METRO s Small Business Development Initiatives. Procurement Committee January 2014

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1 METRO s Small Business Development Initiatives Procurement Committee January 2014

2 Overview METRO seeks to ensure the success of small businesses by exploring ways they can be more competitive in the procurement process. Some impediments to success have been identified as: 1. Lack of understanding of the procurement process 2. Competitive pricing of their product 3. Difficulty in connecting with the prime contracting community 4. Poorly prepared responses to solicitations 5. If successful in obtaining an award, difficulty maintaining the contract due to lack of administrative infrastructure (cash flow, difficulty estimating staffing and/or equipment needs) METRO has worked with internal (procurement, project managers) and external (primes, small businesses) strategic partners and stakeholders to develop an approach to address these issues. 2

3 METRO s Database of Certified Firms METRO provides Small Business Certification to any firm that has been in existence for at least 6 months, does not exceed the SBA size standards and whose owner's Personal Net Worth does not exceed $1.32M The certified database fluctuates but currently has approximately 1,400 firms Approximately 30% of METRO s SBE database has an active contract with METRO. METRO s certification is recognized by the Port of Houston and Houston First Corporation for inclusion in their small business programs Of the firms working, on average, those firms were certified for 5 years when they received their first contract. 3

4 Challenges to Successfully Winning a Contract with METRO Competition Price Capacity Lack of Procurement Opportunities Lack of work in firm s area of work Work is already bid 4

5 Segments of Small Businesses METRO has identified 3 key segments of small businesses: New Businesses: Firms that have been in business from 0-3 years and have expressed interest in working with METRO Intermediate Businesses: Firms from 3-5 years that have not had a METRO contract Experienced Firms: Firms that are 5+ years old that have or had a METRO contract 5

6 New Small Businesses (0-3yrs): Technical Assistance METRO wants to retain an Open for Business stance but the reality is typically a new business will need additional training and assistance to successfully compete in the procurement process. METRO works with the following partners to provide this training for new and/or experienced firms: Capital One Bank Getting Down to Business Program Construction Contractors College Houston Community College Southeast Campus- Center for Entrepreneurship Houston Minority Supplier Diversity Council National Association of Minority Contractors SCORE University of Houston Small Business Development Center Women s Business Enterprise Alliance 6

7 Intermediate Small Businesses (3-5yrs): Interagency Mentor Protégé Program A strategic business development partnership implemented by METRO, the City of Houston, Port of Houston and the Houston Independent School District (HISD) A Formal Memorandum of Understanding between the partners is in progress Strengthens effective working relationships and fosters long term stability between established prime contractors and emerging historically underutilized businesses. Eligible businesses include: Currently certified and in good standing with one or more of the following agencies: City of Houston; Port of Houston; and/or, Houston Independent School District (HISD) Business in continuous operation for last 24 months Current on all taxes and applicable licenses Business revenues between $150,000 and $4.0 million in the most recent fiscal year A minimum of four (4) employees 7

8 Interagency Mentor Protégé: FY13 Track 1 of the curriculum Creating a Highly Favorable First Impression when Presenting Your Small Business Business Plan review Legal Structure Review Personal Financial Management and Income Goal Planning Understanding Your Business Financial Model Mock RFQ Exercise Track 2 of curriculum How to Present in the Boardroom Cash Flow Management/Projections Mock RFQ Exercise- as a Joint Venture Human Resources (Policies and Procedures/ How to Ramp up for Projects) 8

9 Interagency Mentor Protégé: FY13 15 protégés completed Track 1 of the curriculum 5 Construction; 6 Professional Services; 2 Architectural/Eng; 2 Supplies 15 protégés will begin Track 2 in February 2014 New applications for Track 1 will be accepted in March 2014 The anticipated start date for the new class is June Participating Mentors: MV Transportation Tellepsen Construction Chester Engineers HDR Engineering KBR Freese & Nichols Dominion Capital The Principle Partnering Group Verbal Energy Graebel Rice & Gardner Siemens SCORE 9

10 Intermediate Firms (3-5yrs): METRO Small Business University METRO Sponsored Training: I m Certified What s Next Workshop How to Present to Primes Pricing Your Products and Services How to Prepare and Respond to a METRO Solicitation/Request For Proposal How to Create a Safety Plan Post Contract Training: Training on METRO Compliance Database (B2GNow) 10

11 Experienced Firms (5+) Trades Program-Internal Business Development Program (Construction Only) Target outreach for contract opportunity based on procurement look ahead schedule and strategic partner opportunities METRO Open House:Meet the Prime/ Meet the Subcontractor Events 11

12 Future Initiatives Intermediate Firms: Bond Education Training OSHA 10 Safety Training Financing Programs Accounting-Quick Books Training Experienced Firms: Leadership and Growth Seminars OSHA 30 Safety Training 12