CDW-G in search of small-biz partners
- By Michael Hardy
- May 05, 2003
CDW-G's request for proposals
Reseller CDW Government Inc. has issued a request for proposals to find small-business partners. The company is looking for up to 15 small, disadvantaged, woman-owned, veteran-owned and Historically Underutilized Business Zone firms whose skills complement CDW-G's offerings.
In most cases, the partner companies will become prime contractors on federal projects, with CDW-G serving as subcontractor and technology supplier in many cases, said CDW-G President Jim Shanks.
Through the program, CDW-G officials believe they can help agencies fulfill their goals for awarding contracts set aside for such companies and at the same time find creative small firms that need a larger company's resources to strengthen their presence in the federal market. For their part, CDW-G gains partners who add value and channels for product sales.
"Our focus and our approach to this [is] we are looking for partners, and that's why we went to the extensive effort of the RFP," Shanks said. "If it was just to help [agencies] check a box, we wouldn't go that far."
The deadline for submitting proposals is May 9. CDW-G intends to notify selected partners by July 1, Shanks said. The contracts will run for one year, with options to renew.
Company officials are looking for firms that already have some federal presence, as well as financial stability and a solid management team, he said. The company also plans to pick a diverse set of partners.
"If you put them in a room with a dozen [companies] they consider to be their direct competitors, there won't be much information sharing going on," he said. "We want to ensure we have good coverage and not a lot of overlap."
The program could be good for small companies, said Magdalah Silva, president and chief executive officer of DMS International Inc., a small information technology services firm in Silver Spring, Md. She is concerned that woman-owned businesses are not getting as much federal work as they should.
"When the market looks at woman-owned businesses, they tend to say there's a lack of experience, a lack of capital, a lack of ability, a lack of knowledge," she said. "That's the perception, and I would say that's way off base."
However, she said the effectiveness of CDW-G's program depends on the companies it picks as partners.
"For CDW-G, they're hoping to sell more products and have more feet on the street," she said. "Whether that has a real benefit for the small business, it depends on the line of business you're in."
Shanks said the company's goal is to increase the value offered by CDW-G by partnering with one or more firms.
"We don't want to set it up to where we're just trying to fulfill an obligation. We want to set it to leverage what they do well and leverage what we do well," he said. "We want to build a partner portfolio that we can really go deep with."
The contractual arrangement with partners may help address a concern some agencies have about "pass-through sales," a practice that allows small companies to sell services under the name of a larger partner, said Larry Allen, executive vice president of the Coalition for Government Procurement. The practice, which the General Services Administration cracked down on last year, allows the larger company to disavow responsibility if disputes arise.
For the smaller companies that CDW-G chooses, the contract approach and the relationship with the reseller will give them an advantage, said Payton Smith, manager of public-sector market analysis services at research firm Input. Complaints such as Silva's — that small companies don't get as much work as federal guidelines say they should — are probably valid, he said.
"The way so much business has started going through GSA schedules and [governmentwide acquisition contracts], it's an honor system for the agency to comply with the goals," he said. "GSA has plenty of small businesses on the schedules, but it's up to the agencies to pick them. There's less oversight of the requirements."
CDW Government Inc. will select partner companies for federal contracts based, in part, on these criteria: Management — Bidders must provide detailed descriptions of their management staff arrangement for federal awards.
Capability and qualifications — Bidders should describe their abilities to fulfill the requirements listed in the request for proposals.
Financial health — Bidders must show that they are financially able to carry out their obligations under the contract.