A Real Opportunity for Black- and Brown-owned Businesses to Grow in Philadelphia

By Malik Majeed

I am very encouraged by a new program initiated by the Chamber of Commerce of Greater Philadelphia. It is called the Diverse Procurement Collaborative. The program commits 100 of the region’s largest employers to increase the diversity of their contracting networks, bringing more Black- and brown-owned businesses into the contract pipeline in the Philadelphia area as regional employers begin to recognize true shareholder value extends beyond the bottom line.

Our Chamber partners need look no further than our company’s model to show how giving a small Black- and brown-owned under-resourced company an opportunity led to big outcomes. PRWT Services, Inc. (PRWT) started out in Philadelphia by operating one call center as a subcontractor supporting the Philadelphia Parking Authority. Today we are a prime contractor for that agency.

We were given an opportunity, and we proved ourselves, which allowed us to grow and manage operations nationwide. In turn, we continue to hire employees who look like us and come from our neighborhoods, helping us build an economic ecosystem that improves the prospects for those neighborhoods now and into the future.

The unfortunate reality is people tend to hire people who look like them, talk like them and act like them. It is an unconscious bias that we all have, and it creates an ongoing negative cycle. If there is no basis for economic opportunity for Black- and brown people, they are not going to find jobs. If they do not find jobs, they are not able to provide for their children.

It also means they are probably not in a good position to set the positive examples their children need, leaving them without hope.  We have all witnessed the negative impact this has on Black- and brown communities and our society in general.

The participation the Chamber is trying to inspire is very noble.  However, to have demonstrable, repeatable, long term results, the region’s largest employers must live up to this pledge by following through and awarding contracts directly to Black- and brown-owned businesses, or, by insisting the businesses they are doing business with award contracts to Black- and brown-owned businesses via subcontracts. In addition, the region’s largest employers must recognize and be willing to spend a little more and take a little more risk in doing so.

As I have told my peers, other companies are able to spread their costs across multiple contracts, so they can price their proposals lower. Unfortunately, Black and brown businesses and small diverse companies are not able to spread their costs across multiple contracts.  Usually, they are living off one or two active contracts at a time. They do not have the capacity to spread costs across multiple contracts in the same way as larger companies.

One opportunity is great! However, if you want to see Black and brown businesses become successful and grow, you must provide those businesses with additional opportunities. And as their customer base grows, you will see them hiring and providing opportunities to other Black and brown businesses. Indeed, a recent McKinsey study found that if we can get to a point where there’s revenue parity between Black-owned and white-owned businesses, it could add billions of dollars to the national economy.

This effort by the Chamber over the next two years is not just a feel-good plan. It is about measuring results and sharing best practices.

At PRWT and our wholly owned subsidiary U.S. Facilities, Inc., we practice what we preach. We provide others with opportunities. We hire, purchase goods and services and contract with other diverse companies, providing individuals a chance to support their families and/or grow their businesses. We also mentor other diverse companies.

Regional employers cannot nickel and dime diverse businesses over shareholder value because true shareholder value cannot always be measured in dollars and cents. When people’s houses are getting boarded up or whole neighborhoods are going under while a company’s stock price is going up, what are we doing to our cities and our country? That is what all of us in positions of corporate leadership must consider.