Small Business Seeks Bigger Piece of County’s Pie

0

It’s an embarrassing statistic: In the small-business capital of the nation, less than one half of 1 percent of all Los Angeles County contracts and purchase orders go to small businesses.

Now the Los Angeles County Small Business Commission wants to do something about it. The commission has recommended to the Board of Supervisors that the county adopt a goal of 25 percent of contracts going to small businesses, as defined by the U.S. Small Business Administration (which has a whole range of criteria that vary by industry). The board is expected to take up that and other recommendations next year.

The city of Los Angeles and the state both have small-business participation goals of 25 percent, though the goals are rarely achieved. The county has no such goal.

“The county awards a huge amount: $15 billion in contracts and purchases each year,” commission Chairman Ray Bishop said last week. “Right now, small businesses get practically nothing.”

But the owners of one local small business that has long sought county contracts said a lot more than just setting a goal needs to be done. Brothers Baruch and Betzalel Eichenbaum, who own Business Machines Consultants Inc., a copier and printer supply business near Van Nuys Airport, said the county has to rethink how it prepares contracts.

Their firm used to have a steady stream of county contracts, but that has dried up in recent years as contract requirements have tended to increasingly favor large companies.

For example, many contracts for copiers now require that the bidder be able to supply a huge range of copiers, from high-end color copiers and machines that can generate 135 copies per minute to simple models that produce 40 copies per minute.

“If you can’t supply each and every model in the entire range of copiers that the county wants, then you are automatically disqualified, even if you can bid a cheaper price for the models that you do have,” Betzalel Eichenbaum said. “Small copier shops simply don’t have that kind of inventory, so they can’t even get in the game. These contracts are written exclusively for the big boys, like Xerox. Until that mentality changes, setting a goal won’t accomplish much.”

The Eichenbaums said one way to change this would be to require the contract procurers in county departments to meet with small businesses before crafting contract language.

Hailing Franchise

Los Angeles Checker Cab, a Van Nuys taxicab co-op, is close to snagging an additional taxi franchise slot expected to open up in Beverly Hills – something the co-op’s president said will help his drivers compete with increasingly popular competitors such as Uber and Lyft.

The Beverly Hills City Council is set to hold a second vote next month to convert the city to a taxi franchise system. The city has long had a certificate system that has effectively been limited to three operators: Beverly Hills Transit Co-Op Inc., Independent Taxi Owners Association and United Independent Taxi. To increase competition, the city will awared five franchises. Besides Checker Cab, the other expected new entrant is Bell Cab Co.

Checker Cab, which serves the cities of Los Angeles and West Hollywood, has long sought entry into the Beverly Hills market.

“It’s a city with a lot of restaurants and entertainment that we’ve been trying to get into for a number of years,” said co-op President Yevgeny Smolyar. “That’s become even more urgent now that we have to compete with Uber, Lyft and Sidecar. We need to spread out our service territory as much as possible.”

Smolyar said the co-op also plans to apply for franchise slots in Santa Monica and Culver City as soon as any open up.

Checker expects to begin operating in Beverly Hills in April, pending final council approval.

New Zone?

As it moves forward with its zoning code revamp, the city of Los Angeles is looking at establishing a new zone category for big master-planned development projects, something that could make them easier to build by allowing developers to skip some of the special public hearings and additional permits they now require.

In a recent presentation to the Los Angeles Area Chamber of Commerce, city planners indicated the zone could be tailored to specific campuslike developments. Projects such as stadiums, entertainment studios, hotels and hospitals could be candidates for these special zones. In most cases, the project would have to encompass at least three acres and contain at least three structures.

The major advantages, the presentation said, are better-designed projects as well as a more streamlined and predictable approval process.

As the plan goes forward, though, it’s expected to generate opposition from homeowner groups and other slow-growth advocates who say requiring these types of major projects to get conditional use permits and go through extensive hearings is crucial to protecting neighborhoods.

The presentation said other cities in Los Angeles County, including Glendale, Pasadena and Long Beach, have adopted similar master-planned development zones.

Staff reporter Howard Fine can be reached at [email protected] or (323) 549-5225, ext. 227.

Previous article L.A. Launch List: Dec. 12
Next article Stocks Mixed
Howard Fine
Howard Fine is a 23-year veteran of the Los Angeles Business Journal. He covers stories pertaining to healthcare, biomedicine, energy, engineering, construction, and infrastructure. He has won several awards, including Best Body of Work for a single reporter from the Alliance of Area Business Publishers and Distinguished Journalist of the Year from the Society of Professional Journalists.

No posts to display