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Website Connects Small Businesses With Big Contract Opportunities

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American multinationals spend an estimated $1.52 trillion on goods and services from U.S. small businesses every year. But only 1 in 10 small business owners say that selling to large companies offers them opportunity for growth, according the American Express OPEN Small Business Monitor.

Why are so few small businesses lining up to feed at the big-company trough?

It's not for lack of opportunity. There are only 1,000 companies in the Fortune 1000, Rob Ganjon, a vice president with American Express OPEN, told BusinessNewsDaily. But the typical large company like American Express or General Electric has 20,000 to 30,000 suppliers.

"It's the long tail," said Ganjon.

A large part of the problem is trying to penetrate the procurement cone of silence at large companies, he said. It's hard to identify the decision makers.

"It's tough to find people in any large company," Ganjon said. "It's even harder to find the person who can make a purchasing decision."

Procurement portals, also known as business matching services, can help small businesses make the critical connection with large company buyers. They function as networks to bring together buyers and sellers.

American Express OPEN recently teamed with business exchange Ariba to launch Ariba Discovery, a matching engine that reduces friction between buyers and sellers for small businesses.

"It's for B2B commerce," Ganjon said. "We are in the process of moving our entire procurement process to Discovery."

Other large corporate buyers using the exchange are Home Depot, Nestle and Office Depot.

Sellers fill out an outline profile that includes a description of the company and a listing of products and services it provides and are notified by email when an appropriate selling opportunity becomes available.  It comes in two forms — a no-frills free version and a more fully featured pay-for-play version.

"It gives small businesses a seat at the table when large companies are making purchasing decisions," Ganjon said.



Reach BusinessNewsDaily senior writer Ned Smith at Follow him on Twitter @nedbsmith.




Ned Smith

Ned was senior writer at Sweeney Vesty, an international consulting firm, and was Vice President of communications for iQuest Analytics. Before that, he has been a web editor and managed the Internet and intranet sites for Citizens Communications. He began his journalism career as a police reporter with the Roanoke (Va.) Times, and was managing editor of American Way magazine and senior editor of Us. He was a Captain in the U.S. Air Force and held a masters in journalism from the University of Arizona.