Norfolk finds new way to increase contracting with minority, women-owned businesses – The Virginian-Pilot

NORFOLK – Several years ago, Stephanie Onyeayana wanted to take matters into her own hands and be her own boss.

Her mom used to work three days a week as a nurse while also operating a cleaning business. So it came naturally for Onyeayana to start her own commercial cleaning business in 2017 called Kingdom Up Inc.

“I started it with my own savings account and just a lot of sacrifice,” she said of the company, which now has six full-time and four part-time employees.

Business grew in fits and starts, the pandemic first setting her back, then recovering. Customers have included the Foodbank of Southeastern Virginia, the YWCA, and medical facilities.

But one thing always seemed out of reach for her small business — the stability and scale of a municipal multi-year contract.

“It’s always been a business goal of mine, but I never thought that I would qualify or have the opportunity because I just thought it was set aside for larger companies or well-known companies,” Onyeayana said.

In 2023, Norfolk launched a new effort to increase the city’s contracts with minority and women-owned businesses. 

“Debundling” takes a large contract and cuts it into multiple contracts that smaller businesses are able to apply for. It was through this process that Onyeayana finally achieved her goal of landing a city contract.

In this case, a $2.3 million janitorial contract was turned into eight smaller ones, of which six are now held by Black-owned businesses, according to Aleea Slappy Wilson, Norfolk’s first Diversity, Equity and Inclusion officer. The businesses eligible for the debundled contact must be certified as a small, women-owned and minority-owned business, also known as a SWaM.

“We can’t expect every business to go after our large contract if they’re not ready for a large contract,” Wilson said at a Dec. 12 work session with City Council. “But what we hope is that if you are able to obtain a contract that is at the level at which you can do business, that you will grow into the other opportunities.”

Getting the five-year contract in February has “leveled up” her business, Onyeayana said.

“It’s a dream come true,” she said.

Several of the smallest businesses that were able to get a slice of the debundled janitorial contract also went through a training program to prepare them for future contracting opportunities, according to Wilson. In fiscal year 2023, the city spent more than in any previous year on contracts with minority and owned women businesses — about $9.4 million. In fiscal 2022, the city spent a little over $4 million.

However, not every city contract is suitable for debundling and when contract renewals come up, it can be difficult to identify whether the need could be filled by local small businesses, Wilson said.

“So it’s not like we have a list of what’s coming down the pike necessarily but the janitorial [contract] was the perfect opportunity at the right time,” Wilson said in a phone interview. “We had enough lead time from when it was going to expire for us to really start to break it down.”

The janitorial contract was the first to be debundled. Other contract areas that could potentially be debundled to increase women and minority owned business participation could include accounting and bookkeeping, Wilson said. And contracting isn’t just construction type-development, there are opportunities like the janitorial contract in refuse and guard services.

Splitting larger contracts is not without its issues, in this case, more work for the general services department that handles the contract, according to Wilson.

“It has been more work, if we’re just frank about it,” she said, adding that city staff provides support when needed to several companies that have never had a municipal contract before.

As well as looking at contracting opportunities, Norfolk’s Diversity, Equity and Inclusion department also works to build small, women and minority-owned business capabilities and connections through trainings, seminars, grant assistance and partnerships.

Patricia Bracknell, founder of the Chamber for Hispanic Progress, said her group works with the Norfolk DEI office to help educate people with cash-only businesses about the advantages of owning a documented business, such as lending and tax benefits. She said opportunities through business formalization and the business development training sessions help more minority business owners prepare for success whether through the private sector or government purchasing.

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Building SWaM business capacity is key to making sure they can deliver when an opportunity comes up for the city to spend with them, according to Wilson. That way, its a positive experience for both parties. She said smaller businesses often struggle with staffing or the type of invoice systems that can respond quickly to city opportunities and requests.

“What we’ve seen with a lot of our smaller firms is that they haven’t been forced to think through a full workforce development plan,” she said.

Onyeayana’s goal for the next five years is continue focusing on quality service and then secure another city contract. She said she didn’t know about the type of small business grants that might have been available to her when she used all her savings to start her company.

“It takes money to grow and receive and accept the opportunities that may come our way through the city of Norfolk or other businesses that want to take us on,” she said. “Sometimes the financial backing is not there and you have to start small.”

Ian Munro, 757-447-4097, ian.munro@virginiamedia.com