E-buys stir small-biz fears

The push for paperless government may do more than eliminate mountains of

paper — it may exclude small businesses from the procurement process.

E-procurement initiatives suggested by the Office of Federal Procurement

Policy may preclude small businesses from competing for government contracts,

according to industry experts, members of Congress and agency representatives

testifying last week at a hearing of the House Small Business Committee's

Government Programs Subcommittee.

"Most small businesses are started because someone who oversaw the production

at a company decided to go off on their own," said Rep. Ruben Hinojosa (D-Texas).

"They have a lot of experience in the production of widgets but are weak

when it comes to administration experience and computer science."

OFPP has suggested that procurement announcements and proposals be made

electronically via a governmentwide single point of entry on the Internet.

The new system would eliminate the 15-day waiting period between the announcement

of a contract and the acceptance of bid proposals, said Deidre Lee, administrator

for OFPP.

But many small business do not have access to technology or are not

equipped to handle electronic transactions, according to Jere Glover, chief

counsel for advocacy at the Small Business Administration.

"Only 1.4 percent of Internet use among small businesses is directed to

e-commerce sales," Glover said in a written statement to the subcommittee.

"Costs, security concerns, technical expertise and customer service are

the major roadblocks to greater small-business participation in e-commerce."

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