I am an endless advocate for small business, always have been and always will be. It is within my core. While at lunch with a government leader of a major dealership the conversation veered towards this subject very close to my heart - small business manufacturers: Why do these unsung heroes matter to the industry and specifically dealers?
I happen to have many answers and insight into this question!
With experience working for small business manufacturers earlier in my career, I now dedicate my efforts to supporting them through Catalyst. Additionally, I take pride in being a woman-owned small business myself. Through this lens, let’s delve into the importance of small business manufacturers to our industry.
Let me start by saying, my goals on this topic:
For Small Business Manufacturers: Empower yourselves to harness your superpower and strategically position your business within your dealer network to thrive.
For Large Business Manufacturers: I encourage you to forge partnerships with small manufacturers to enhance your dealer support capabilities and foster industry innovation.
For Large, Aligned Dealerships: Recognize the value and ingenuity that small business manufacturers can bring to your business to elevate your offerings and meet customer demands.
It’s important to understand that Small Business Manufacturers play an important role in the Federal Government’s socio-economic goals.
Small Business Spend = 23%
5% 8(a)
5% Woman Owned Small Business (WOSB)
3% Historically Underutilized Business Zone (HUBZone)
3% Service-Disabled Veteran Owned Small Business (SDVOSB)
These goals have been in place for many years, but recent changes to the Packaged Office (POC) program and to the SBA program have made the use of small business manufacturers mandated in certain situations. Here are some examples & tips in how to leverage small business status:
RFP Opportunities - It is no longer allowed for the bid responder / 8(a) dealer / POC holder to be a small business and fulfill the requirements of an RFP that is a small business set aside. 100% small business manufactures are required to represent up to 100% of the bid response.
Confirm if your Manufacturer is, in Fact, Small - The majority of the manufacturers in the furniture manufacturing industry use one of the manufacturing NAICS codes that defines a small business as less than 1000 employees. To confirm if a specific manufacturer is small I would check in e-library (https://www.gsaelibrary.gsa.gov/ElibMain/home.do) or on the System for Acquisition Management (www.SAM.gov)
Socio Economic Status has Strong Marketing Power - You can’t expect that everyone knows your socio-economic status. Make sure you include this prominently on your website, literature and in your conversations!
Now that we know all of this GSA-rich information, what are the other benefits of working with a small business furniture manufacturer?
Unique and customizable products - Smaller manufacturers tend to focus on specific product categories and do those REALLY well. They also tend to have some more unique, innovative offerings in their categories and they are willing to work with the client for customization.
Personalized relationships at higher levels: They’re “lean and mean”! With small manufacturers you have the opportunity to build relationships with leaders of the company. This allows for better communication, faster problem-solving, and more tailored support, which can lead to improved customer satisfaction.
You mean more. You’re really important to them: If you are a larger dealer or have larger volume to offer to a small manufacturer you could be a big fish in a smaller pond. A lot of times it is easy to get lost at a larger manufacturer especially if you are not doing very large volumes.
Faster Response Times: Both from a quote and from a delivery standpoint, in many cases small manufacturers can be more nimble and deliver faster.
Design support: A lot of small partners either do the quoting or the design for you. As the expert they save you time and possible errors.
Competitive Pricing: Some large manufacturers have great pricing, but there are also small manufacturers who can beat their pricing on some niche products helping you reduce your overall cost to the client and/or increase dealer margin.
Higher Profitability: In my experience, small manufacturers are open to being partners in the business with you. They are open to discussions about dealer service fees, deeper discounts on large quantities, and many offer spiffs (even on GSA!!!) This puts more money in your pocket and you’re doing a good thing at the same time!
In summary, small business furniture manufacturers bring diversity, innovation, customization, and a personal touch to the industry. They provide a valuable opportunity for dealers to differentiate themselves in the market, cater to specific customer needs, and offer a wide range of high-quality, unique, and sustainable products. Additionally, working with small business manufacturers, dealerships contribute to local economies. Creating jobs. Supporting local communities. This tells a great story and may become a part of their business values.
Ultimately, the choice between a small business manufacturer and a large manufacturer depends on the furniture dealer’s specific business strategy, target market, and priorities. I believe there is a lot to be said for the unique offerings, personalized service and potential higher profitability that small business partners can offer and I would encourage every dealer, especially those selling on GSA, to have a small business manufacturer plan in place.
Can you think of other reasons dealerships should be working with small business manufacturers? Let me know! I want to hear from you! [email protected]
ABOUT MICHELLE WARREN
Founder, President - Catalyst Consulting Group
Michelle Warren is President of Catalyst Consulting Group, a firm specializing in providing strategic solutions to the commercial furniture industry to enhance their sales, positioning, and distribution. With 25 years of industry experience on the dealer and manufacturer side of the industry, Michelle has been recognized as an innovator in selling to the Federal Government, State/ Local Government, Higher Education and Cooperative Purchasing. Her expertise includes: sales strategies, strategic planning, 3-5 year road mapping, targeted marketing plans, distribution development, hiring reps, and training for reps and/or dealers. Michelle is known as a “serial networker” in the furniture industry and enjoys meeting people and making connections happen.
If you’re interested in connecting - reach out at: [email protected], connect on LinkedIn or visit www.strategic-catalyst.com to learn more about her work.
As seen in Delve | September2023 V.42