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SchoolcraftCollege

BusinessDevelopment

Center

18600 Haggerty RoadLivonia, MI 48152

Phone:734-462-4438

Fax:734-462-4439

Email:inforeq@schoolcraft.cc.mi.us

December 2002

Michigan Small Business DevelopmentCenter Takes Technology to the Next Level

Jill A. Wallace, MI-Small BusinessDevelopment Center

The Michigan Small Business DevelopmentCenter (MI-SBDC) network provides a fullrange of services for a variety of smallbusinesses that are emerging and growingthroughout Michigan — new venturecompanies, existing small businesses,expanding businesses, new technologycompanies, and innovators.

As Michigan continues its statewidetechnological advancements, the MI-SBDChas added four Technology Business ResourceConsultants (TBRCs) to its list of services.

The TBRCs serve as catalysts for the growth ofMichigan’s small, high tech, innovative, andfast growing companies, building upon astrong foundation of assistance by traditionalSBDC consultants.

TBRCs work with fewer clients than thegeneral MI-SBDC business consultants andprovide proactive facilitation, strategicplanning for business development, assistancewith intellectual property issues and help inaccessing alternative financing.

In contrast, MI-SBDC general businessconsultants work with a wider variety ofcompanies providing more typical businessdevelopment assistance such as business planwriting, cash-flow projections, and marketingand human resource consulting.

Many of the general business consultants haveareas of expertise that the technologyconsultants can use when assisting technologyinnovators. The MI-SBDC general businessconsultants also help technology consultantsidentify innovators and small businesses thatmay be Small Business Innovative Research(SBIR) eligible.

All TBRCs hold a master’s of businessadministration degree or equivalent; have five ormore years of business experience; and two or moreyears experience in a technology-related field. Theirexpertise reflects Michigan’s technology initiativesand needs in four functional areas: advancedmanufacturing, bio-medicine/life sciences, energy,and information technology.

The consultants work in a virtual officeenvironment serving all of Michigan’s 83 counties.Physical offices are located in West Michigan atGrand Valley State University’s Seidman School ofBusiness; in Southeast Michigan at EasternMichigan University’s College of Business; in EastMichigan at Oakland University’s School ofBusiness Administration; and in Boyne City atNorthern Lakes Economic Alliance.http://www.mi-sbdc.org

Vision to RealityThis two-hour seminar, held at theLivonia Chamber of Commerce, is designedfor persons interested in learninga practical step-by-step process for startinga new business. The session will provideparticipants with a network and resourceto use when questions arise.

January 15, 2003 9:30 am – Noon

January 29, 2003 6:00 pm – 8:30 pm

February 12, 2003 9:30 am – Noon

February 26, 2003 6:00 pm – 8:30 pm

March 12, 2003 9:30 am – Noon

March 26, 2003 6:00 pm – 8:30 pm

$20 per person

Please call 734-462-4438 to register.

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George W. Ash, Dykema Gossett PLLC

Two recent events suggest the trend towardbundling has not only slowed, it may even bein retreat. The first is the release of a reportby the Small Business Administration Officeof Advocacy (OA). The second is a bidprotest decision issued by GAO (TRSResearch, B-290644, September 13, 2002).

The Small Business vs. Contract “Bundling”

Integration ofPRO-Net and CCRDatabasesThe Small Business Administration (SBA)is taking a big step to simplify the way smallfirms do business with the Federal governmentby changing how the Procurement Marketingand Access Network (PRO-Net) databaseoperates. SBA has partnered with the U.S.Department of Defense’s Defense eBusinessProgram Office to integrate PRO-Net and theCentral Contractor Registration (CCR) systemby October 31, 2002.

Registration AssistanceJanuary 16, February 13, or March 13, 2003

8:30 a.m. – 11:30 a.m.$15/person

Business Development Center clients lookingfor assistance completing their CentralContractor Registration (CCR), SBA’sProcurement Marketing and Access Network(Pro-NET) or any other online registrationare invited to the BDC’s open lab.Counselors will be available to help clientsunderstand and complete their registrations,using the BDC’s computer lab.

RESERVATION REQUIRED

For more information on any of theseseminars, contact the Business Development

Center at 734-462-4438.

GovernmentContracting Seminar

January 9, February 6, or March 6, 20039:00 a.m. – 12:30 p.m.

$35/personDid you know that the FederalGovernment purchases more than $200billion dollars of goods and services everyyear? Find out what it takes to successfullysell your goods and services to the FederalGovernment and the State of Michigan.In addition, learn about the services andresources the Business Development Centerhas available to help your company withthe contracting process.Important notes

• The process is being streamlined so firmscan automatically register inPRO-Net (http://www.pro-net.sba.gov) andCCR (http://www.ccr.gov) at the same time.

• Firms already registered in PRO-Net mustcheck their record and be sure it contains avalid DUNS number. If a firm does nothave a DUNS number, it should contactDun & Bradstreet, Inc., at 800-333-0505to obtain the free nine-digit identificationnumber.

• Firms currently registered in the CCRshould make all future PRO-Net and CCRprofile updates via their CCR record.

• If the firm is not registered in CCR, itshould visit the CCR website at http://www.ccr.gov and register immediately.

For additional questions regarding CCR orPRO-Net, please contact the BDC at734-462-4438.

What is bundling? Under the Small Business Act,bundling is defined as, “consolidating two or moreprocurement requirements for goods or servicespreviously provided or performed under separatesmall contracts…into a solicitation of offers for asingle contract that is likely to be unsuitable foraward to a small business concern…” As more andmore goods or services get bundled, it tends toeliminate small businesses that perform some, butnot all of the requested tasks.

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In sustaining the protest, GAO stated itwould not define “procurement requirement”as broadly as the Army, and in fact stated todo so would effectively defeat the SmallBusiness Act restriction. The Army hadalso failed to coordinate its solicitation withthe local SBA office.

In August GAO sustained another protestof a bundled contract issued by the Armyconcerning combining latrine services andfixed site waste removal (Vantex ServicesCorp. B-290415, August 8, 2002). GAOcurrently appears to be sympathetic to asmall business challenges againstprocurement bundling.

Bundling has had a significant negativeimpact on small business. The good newsis Congress is aware of it and openlyexpressing its concern, while GAO is takinga harder look at protests against bundledawards.

George W. Ash is a member of the law firmof Dykema Gossett PLLC in Detroit, wherehe specializes exclusively in governmentprocurement issues. He may be reached at313-568-6797.

Note: This update provides information ofgeneral interest presented in summary form,and does not constitute individual legaladvice.

How big of a problem is it? According to theOA, both the number of bundled contracts andthe amount of bundled contract dollars were thehighest in 10 years, up nearly 20 percent in thepast 10 years.

Bundled contracts account for 16.4 percent ofthe 177,000 federal agency prime contracts,and a whopping 51 percent of all reportedprime contract spending. While agenciesawarded 105,000 out of the 177,000 primecontracts to small businesses, or 59.3 percent,small businesses received only 52.7 percent ofthe bundled contracts, representing only 16.7percent of the bundled contract dollars.

According to the OA, contract bundling coststhe small business sector nearly $13 billionper year, with a decrease of 60 individualawards to small businesses for every 100bundled contracts. Of the top 100contractors receiving bundled contracts, onlyfour are officially classified as small business.

Bundling is centered in the Department ofDefense, which accounts for 65.6 percent ofall bundled contracts over the past 10 yearsand 80.8 percent of all bundled contractdollars. Stated another way, 10 percent of alldefense contracts and 55 percent of all defensedollars over the past 10 years were bundled.

It is against that backdrop that GAOconsidered the protest of TRS Research. TRSwas protesting the award of a bundledcontract for intermodel container equipment,and corresponding development andmaintenance of a Web-based informationmanagement system. The solicitation wasissued by the Army Military TrafficManagement Command on an unrestrictedbasis, because it stated it had no expectationthat two or more small businesses existed thatcould meet the requirements.

However, three of the nine vendors under theprior Indefinite Delivery/Indefinite Qualitymaster lease agreements, which the bundledcontract was replacing, were small businesses.

TRS contended the award violated the“unjustified bundling” restriction of the SmallBusiness Act, while the Army argued thatawarding a single contract to one contractorwill “cure performance problems,” and wasjust a single broad procurement, notbundling.

The Defense Appropriations Act, signed byPresident George Bush on January 10, 2002,reduces the on-going fee charged to the lenderon new 7(a) loans made to small businesses thatwere “adversely affected” by the September 11,2001, terrorist attacks and their aftermath.Please refer to SBA Procedural Notices 5000-765 and 5000-769 for details on eligibility.

http://www.sba.gov/news/star.html

The Star LoanProgram

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Jeff Meyer, Van Andel Global Trade Center atGrand Valley State University - Grand Rapids

As an international manager, do you haveconcerns about your international exposure? Areyou compliant throughout and across yourorganization? Have you ever received that call atthe end of the day from overseas telling you thatsomething terrible has happened and yourproducts have been seized?

International trade compliance is perhaps theleast appealing function of internationalbusiness. It involves a myriad of details,changing rules, and exponential difficulty acrosslarge numbers of countries. In general, it is notseen as adding value, generating revenue, ormaking our lives easier. In the end, the way inwhich we look at compliance will determinewhether it is our friend or enemy. Complianceshould not be feared, it should be managed.

Compliance as a FOEIf you are involved in international trade of sometype, international compliance is in your vocabulary.The more complex your business and products, themore complex your compliance issues become. Thelarge number of details inherently means you mustdedicate human resources to the issue. Thepotential damages demand that upper managementdevotes a portion of its time to this cause.International trade compliance can be your enemyif you look at it in these terms.

Labor turnover can be the worst enemy ofcompliance, especially if there are no documentedprocedures and policies for a compliance program.Once the compliance expert leaves, the methodsand procedures of the company also leave, and thehistorical information cannot be retrieved.

One important point to remember is thatcompliance is not a person it is a function. Do notrely on any one individual to take care of yourcompliance issues in the absence of a program,process, and policies. While compliance championsare important, they eventually move on.

Lack of information dissemination is one of the keyreasons compliance can be your company’s foe.Compliance requires that information flow to andfrom many areas of the company to be successful. Ifinformation does not flow properly, or does not flow

at all, confusion is created and compliance problemsappear.

The lack of a process or the presence of a flawedprocess can be the biggest obstacle to internationalcompliance. Compliance is an afterthought for manycompanies that have expanded quickly intointernational markets. Many consider its existence ahindrance to international expansion. If complianceprograms can be implemented in the initial stages ofinternational growth, time and money can be saved assales are realized.

Without the proper compliance program, all ofthese issues can ring true. Furthermore, theconsequences of a failed program will ring loudly.Fines, penalties, and seizures can range fromcreating a little glitch to destroying allinternational activity. Customs agencies arefocusing more and more on compliance issueswithin companies. More importantly, these issuescan cause a loss of momentum in marketpenetration, as you suddenly divert resources tomanage the problem.

The time it takes to solve the smallest complianceissue can pay for three compliance managers inyour company. More than anything, problemswith compliance can affect and detract from otherbusiness that you are trying to generate. Becausecompliance issues affect everyone up and down thechain, they can irreparably harm a good customeror supplier relationship.

Compliance as a FRIENDCompliance can be your friend if you put it inthe proper perspective and have the rightmindset. Good company compliance practicescan set you apart from other companies. Poorcompliance can affect your customers and yoursuppliers adversely. A sound compliance recordcan make your company more attractive.

In the medium and long term, complianceprograms reduce cost by limiting the number ofindividuals dealing with compliance andavoiding penalties for wrong doing. Mostcompanies that have had any major complianceinfractions will tell you it is better to establishyour program and processes now rather thanwait until problems occur. The excuse, “I didn’tknow about that,” will certainly not work in thecase of an audit.

International Compliance: Friend or Foe?

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Upcoming Seminars and Events

RESERVATIONS REQUIREDfor all seminars!

Please register at least one week before theevent – seating is limited! For more

information on any of these seminars, contactthe Business Development Center at

734-462-4438.

TEAM SBA FinancingRoundtable

December 5, 2002 OR March 6, 20039:00 am – 11:00 am

No charge

If you are starting or expanding a business andneed financing, plan to attend a TEAM SBAFinancing Roundtable. You will meet withbankers, SBA loan officers, and small businessconsultants to discuss your financing needs. Theroundtables are limited to a small number ofbusiness owners, and you must register toattend. Please call the SBA at 313-226-6075 toregister.

Certified: Woman BusinessEnterprise

December 18, 2002 OR April 18, 20039:00 am – 11:00 am

$25 per person

The Michigan Women’s Business Council inviteswomen business owners to an orientation sessionto learn what it means to be certified as aWoman Business Enterprise. If you have aproduct or service that you would like to marketto American corporations, here is your chance toexplore certification. The Michigan Women’sBusiness Council is a program of the Center forEmpowerment and Economic Development(CEED), an SBA Women’s Business Center.Please call the Michigan Women’s BusinessCouncil at 734-677-1444 to register.

SBA Microloan OrientationFebruary 23, 2003

9:00 am – 11:00 amNo charge

If you have had difficulty obtaining a bank loan,or you need a small amount of money, amicroloan may be the solution. Microloans areavailable from the Center for Empowerment &Economic Development (CEED), a non-profitintermediary and an SBA approved intermediary.CEED encourages you to attend an orientationbefore applying for a microloan. Microloans areavailable for businesses located in Washtenaw,

Livingston, Oakland, Macomb and Waynecounties, except Detroit. Please call the SBAat 313-226-6075 to register.

The Pros on ProposalWriting

February 11, 20039:00 am – Noon

$15 for NCMA members and$35 for non-members

Contracting officials responsible for variouscommodities at Tank-automotive Command -Warren will discuss the key elements inwriting a successful proposal. There will be apanel discussion and Q&A session. Topicsinclude: spare and repair parts procurements;R&D and systems procurement; best valueand low price contracting methods; cost andpricing information; and electronic proposalsubmission procedures. The seminar issponsored by the Schoolcraft CollegeProcurement Technical Assistance Center andthe National Contract ManagementAssociation.

Government ContractingNetworking Event

Many companies have expressed an interest ingetting together with other small businessesfor a chance to talk “procurement shop.” Ifyou are interested in the Schoolcraft CollegePTAC sponsoring a coffee and conversationprogram, please contact our office at 734-462-4438. Mention “Coffee andConversation” and your preference for a 7:30am – 9:00 am event or a 5:30 pm – 7:00 pmevent. Thank you for your interest.

Schoolcraft CollegeBusiness Development Center18600 Haggerty Road

Livonia, MI 48152-2696

BOARD OF TRUSTEESCarol M. Strom ...................... ChairpersonMary Breen .................... Vice ChairpersonBrian D. Broderick .................... SecretaryRichard J. DeVries ..................... TreasurerKevin McNamara ......................... TrusteeGregory J. Stempien ..................... TrusteePatricia Watson ............................ Trustee

Conway A. Jeffress, President

The Business Development Center is happyto announce that we now have access toAIA/NAS documents. Our library ofspecifications and standards now includes:military specifications/standards/drawings;SAE standards; ASTM standards; and AIA/NAS standards. For information on theavailability of a document, please contactthe BDC. All documents are $1 per page.

In addition to specifications and standards,we also have access to procurement andtechnical data on products the governmentbuys. To request a report, please fax,phone, or email the National StockNumber (NSN) or part number to us andwe will send you a report within 24 hours.

Phone: 734-462-4438fax: 734-462-4439

email:inforeq@schoolcraft.cc.mi.us

ObtainingSpecifications andTechnical Data

Basic Steps to InternationalCompliance:

• Identify all potential risk factors• Establish company-wide policies, procedures,

and guidelines• Establish a compliance program that includes

training, information dissemination, anddocumentation

• Use all service providers for support, assistance,and input

• Perform a self-audit on all international tradecompliance related issues.

If you address compliance issues within yourcompany now, you can prevent a lot of extra cost,time, and loss of credibility later. If compliance hasnot been a major focus for your company, first bethankful you have not been affected, and thenestablish a compliance program immediately. Justbecause you currently do not have a red flag, doesn’tmean it isn’t there. It just means you haven’t seen it.

The Van Andel Global Trade Center is dedicatedto increasing international business in the State ofMichigan. If you have any questions or commentsregarding this article please contact the VAGTC at616-771-6811.

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