City gives new foothold to small businesses

Minneapolis to implement program to diversify its contractors

By Kevyn Burger
Wednesday, October 5, 2016

Qualified small businesses will have a broader opportunity to compete for contracts with the City of Minneapolis, thanks to a new program that will launch on January 1, 2017.

The city’s Target Market Program, which will apply to contracts for goods and services that total up to $100,000, will be the exclusive province of small businesses, as defined by the size standards of the Small Business Administration. To meet requirements and secure city contracts, those small businesses must be independently owned, controlled and operated within the 13-county metro area.

The program is race and gender neutral.

“Prior to this, the city of Minneapolis has not had a program that is specifically focused on small businesses. This is intended to level the playing field in a way that will benefit them,” says Deputy City Coordinator Nuria Rivera-Vandermyde. “For contracts up to $100,000, these small businesses will be bidding against other businesses of the same size. When small businesses compete, it can save the city money and give us more choices.”

The Target Market Program will be rolled out after months of work on the drawing board. Rivera-Vandermyde says the city sent out surveys to 1,600 small businesses to get their feedback and to find out how to make more potential vendors aware of opportunities to bid on contracts with the city. The majority were businesses with gross receipts under $1 million and fewer than 20 employees.

Results of that survey showed that 45% of the businesses that responded had never done business with the city, but 74% indicated they would be likely to participate in the new Target Market Program.

In addition, in August, River-Vandermyde hosted and facilitated focus groups with some of those potential vendors to seek their input in refining the program’s eligibility requirements.

“The metro area has seen a surge in entrepreneurs and we want them to not just survive but to thrive. This outreach can strengthen them,” she adds.

The program was approved by the City Council and Mayor Betsy Hodges. In a statement from the city, Hodges indicates the new rules should provide wider opportunities to a diverse array of small businesses.

“Minneapolis is a fast-growing city, and the dynamism of small businesses and immigrant entrepreneurs are driving our growth,” says Hodges. “The Target Market program will have a huge impact on expanding opportunity for small businesses, and women- and minority-owned businesses in particular, by making it easier for them to do business with the large employer that is the City of Minneapolis.”