Why Do Government Agencies Empower Small Businesses in Government Contracting?

If you’re a small business hesitant to enter government contracting out of fear that large companies dominate the space, you’re not alone. While it’s true that the field includes many major contractors, that doesn’t mean small businesses don’t have a real opportunity. In fact, the government actively creates pathways to ensure small businesses have a fair chance to compete and succeed.

This is what Shirelle Evans has said—she’s a procurement manager who has been working behind the curtain for a while. She’s been working with small businesses and she understands why they are given opportunities to bid on contracts.

Before we understand why procurement managers like Shirelle Evans actively support small businesses, it’s important to first understand her role as a procurement manager.

Shirelle Evans and Her Position As a Procurement Manager

Before her professional career began, Shirelle Evans was always someone who sought to add value in everything she did from a very young age.

“So it kind of started with understanding that I was able to add value very early on—not even in a career, just in general,” she recalled.

One of her earliest experiences was helping her parents buy their first home. She would ask thoughtful questions like, “Did you think about this? How am I able to add some value?”—suggesting cost-effective modifications like knocking out a wall or adding a back door, even while maintaining a tight budget.

Her career path began with an internship at GE in Stamford, Connecticut, where she worked on Commercial Finance Strategic Initiatives. This role taught her about strategy, efficiencies, and stakeholder management. Over the years, she has worked in both public entities, such as Newark Public Schools, and private entities, including Toys R Us, Coach, Tory Burch, steel manufacturers, and pharmaceutical companies.

As a procurement manager, her job involves strategic sourcing, which includes thinking about timelines, budgets, suppliers, and efficiencies. She has handled various commodities, from furniture and equipment to specialized items. Her responsibilities include managing bids for different products and services, ensuring the best value and quality for her organization.

Why are There Opportunities for Small Businesses?

As a procurement manager, she has been working with businesses of all sizes and help them to secure contracts

“I love to help small, minority/women-owned/veterans, and set-aside businesses. My goal as a Procuement manager is to help small business understand my role during the pre-bid and post bid activity to increase their chances of winning that Contract,” Shirelle claimed.

“That is something that we have to do—we’ve been doing it prior to, you know, DEI has come out—we’ve been doing this for years,” she added.

Small businesses are often considered the foundation of a nation’s economy. Despite their size, they make a significant impact by driving economic development, generating employment opportunities, and strengthening local communities.

This is why small businesses are actively supported in the government contracting space. Federal, state, and local governments set aside a portion of their contracts specifically for small businesses.

For example, let’s say all the schools in the district need light bulbs—a surprisingly complex and expensive commodity when you consider how many types and quantities are required for 65 schools. Large vendors can usually handle that scale, and she’ll create a big bid specifically for those major national suppliers who can deliver hundreds or thousands of bulbs immediately from inventory.

However, she’ll also create a second, smaller bid just for small local businesses. They might only be expected to supply a smaller number or subset of those bulbs (say, 200 out of 1,500 types), and in smaller quantities (maybe five of each type). That way, the smaller business has a realistic chance of winning part of the contract, and it won’t overwhelm their capacity or cash flow.

She stated, “And we will give it to the set-aside bid, which is specifically for small businesses. Those are the minority, the women-owned, the veterans—all of the above.”

She also notes that while small businesses might face delays or partial shipments, procurement teams understand that and build flexibility into the process. They still want to include and empower these businesses, because long-term participation strengthens the ecosystem.

Even if a bid isn’t officially “set aside” for small businesses, they are still often included in the larger bid pool, and multiple companies can win a piece of the same contract.

“Even if we don’t do a small set-aside bid for smaller companies, we will still include them in the larger pack because oftentimes we then award to several different companies for that one bid,” Shirelle explained.

She continued, “So, what you will see is, if it’s contract electrical light bulbs, it’s contract 8965. It will have maybe a letter or a pound or something at the end, and that will indicate that this has been awarded to several different vendors. So, it could be 8965-A, B, C, D, and E.”

The Purpose of Having Multiple Vendors in a Bid

As shared by Shirelle Evans, when procurement teams put out bids, they often include qualifying questions to better understand a vendor’s capacity. These questions might ask how many employees a company has, or how many contracts they’re already handling.

The purpose is to assess whether the vendor has the resources to successfully take on additional work. If, for example, a company reports they already have $13 million in contracts with another public entity but only 25 employees, that raises concerns. It suggests they may not be able to prioritize a new $10 million contract appropriately.

“If you tell us you have $13 million in contracts with a completely different entity—a public entity—and our contract is for $10 million, we will understand that there’s some risk that’s involved,” she said. “Because if you have $13 million with another and your company has maybe 25 employees, we have to consider that we won’t be priority in that case.”

In those cases, procurement may still award the vendor part of the contract but also spread the work across multiple vendors to reduce risk. This is why contracts often come with a “not to exceed” amount.

Even if a contract says it’s worth up to $10 million, that doesn’t guarantee one vendor will get all of it. Instead, the total amount might be split across several vendors – depending on the project’s needs and the judgment of the stakeholder who controls the budget.

“So, we do take all those things into consideration. And using the same example in terms of the electric bulbs—if they deliver three and we ask for five, we more than likely, if it doesn’t come in the next 90 days, the two we probably won’t order. We’ll tack it on to another one of the vendors that we know has the inventory to deliver and when we need it,” she articulated.

Ensure that the Businesses Awarded Contracts are Set Up for Success

Shirelle makes it clear that in procurement, it’s not just about picking the lowest bidder—it’s about making sure the people they work with can actually do the job. “We don’t want to see anyone we award a contract to fail,” she says.

That’s why they take time to understand each business first. Before they award a contract, they ask important questions to see if the company is ready and able to handle the work.

The contracts also include protections for both sides. “We have clauses that protect us and the provider,” she explains. If something goes wrong, the company usually gets a chance to fix it. “We might give you seven days to what we call ‘cure’—we want to make sure you can do the work.”

A cure notice is a formal warning used mainly in federal contracts, especially with the Department of Defense. It’s issued when there’s a serious problem with how a contractor is performing. The letter will list exactly what’s going wrong and ask the contractor how they plan to fix it. While it’s not something anyone wants to receive, it’s meant to give the contractor a chance to resolve the issue before more serious actions, like contract termination, happen.

Risk mitigation is a key part of their process. They proactively manage risks by asking qualifying questions and conducting thorough research. This helps ensure that the provider can handle the work and reduces the likelihood of failure.

The procurement manager’s role is to add value by making informed decisions and supporting providers. They aim to award contracts to capable businesses and provide guidance to address potential challenges.

“And that’s why I said, you know, you want to add value—that’s what the procurement manager is for. We’re not just not awarding you because you can’t handle the work. But there might be something that we are thinking about that you might not be. And a lot of times, it is risk mitigation,” said Shirelle Evans

How Does Someone Get Paid?

When it comes to getting paid, Shirelle stated, “You cannot perform any services or deliver any products without an executed contract.” That means both parties have signed it and it’s official. If you do the work before the contract is signed and try to send an invoice, you might not get paid. “That is a no-no,” she said.

In public contracts, it’s strict because you need that signed contract before starting. In private sector deals, there’s sometimes more flexibility. Some companies issue a purchase order (PO) instead of a full contract—and that PO is legally binding. It’ll usually have terms and conditions either printed on it or linked somewhere. Once you get a PO, that usually means you’re good to begin work.

Once you perform the service or deliver the product, then you submit an invoice—and it must match the PO.

“And so finally, you perform the services or provide the product, and then you submit an invoice that will match that purchase order. That invoice should have that purchase order number on the invoice—that is also very, very key for us, because we see purchase orders all day long. I issue purchase orders,” she explained.

Behind the scenes, there’s a system that checks to make sure everything lines up. This is called “two-way” or “three-way matching.” For example, a two-way match checks the PO and your invoice. A three-way match might also include an internal document, like a requisition, which shows the money was approved in the budget.

For payment timing, it usually follows what’s in your contract. If your terms are “Net 30,” that means payment comes 30 days after everything checks out—unless other terms were agreed to.

What If Someone Needs an Upfront Money? – They Have to Submit Invoices

Sometimes, you might need money upfront because certain projects require initial investments before any work can begin—like hiring staff, purchasing materials, renting equipment, or covering travel and setup costs.

This is especially common for smaller companies that may not have the cash flow to front these expenses. In such cases, it’s important to discuss these needs with the buyer during negotiations, and if agreed upon, include them in the contract.

According to Shirelle, while some agencies may agree to partial upfront payments (such as 25%), they will never agree to 100% upfront due to risk concerns—they expect vendors to have some financial stake in the project as well.

She explained, ”For example, it could be what I mentioned—the Barbie POs—and we’re actually asking for materials and so forth. They might need monies upfront. But again, that goes back to that risk management—so we know: is this company big enough? Can they do it on their own? Do they need 50%? And we’re negotiating—maybe we bring it down to 25%.”

“We don’t want you to feel like we’re not a partner in this. At the same time, if your company is large enough, we’re going to expect that you have some money upfront—that you have some skin in the game as well, versus just saying, ‘Hey, we want 100% upfront.’ We will never agree to 100% upfront,” she added.

However, as she stated again, you don’t get paid until you’ve actually done the work or delivered the products—and submitted an invoice.

While sometimes partial upfront payments (never more than 50%) are allowed—usually for things like production needs or hiring full-time employees in advance—you still need to invoice for the remaining amount after services are performed or goods delivered. Once an invoice is submitted, payment is made based on the agreed terms (like Net 30 or Net 45).

But if the invoice is incorrect—like billing for more hours than were actually worked—the business owner will flag it. Procurement managers like her aren’t the ones who approve payments, but they can step in to help resolve issues if there’s a dispute, like asking for supporting documents to verify the work.

“The procurement manager cannot pay you. We have nothing to do with payments; we’ve done all of our due diligence, and you are now a supplier in the system,” she stated.