How To Do Business With The State

At an event I attended last week, I received a brochure titled “How to do Business with California State Government: A Five Step Process,” published by the Department of General Services (DGS).

The quote on the front of the brochure is from Governor Schwarzenegger: “California’s economic prosperity is tied directly to the success of our State’s small business.”

It’s an odd sized brochure printed in very bright colors, outlining the procedures and steps required for getting qualified to do business with the state.

Step one requires interested businesses to register with “eProcurement” to create a profile.

Step two teaches business owners how to get certified as a small business or as a disabled veteran business enterprise.

Step three explains the California State Contracts Register (CSCR), “your one-stop central information source for contracting opportunities,” where state agencies post their solicitations and RFP’s.

Step four explains how to become a California Multiple Award Schedules (CMAS) Contractor. “State and local agencies shop and compare CMAS for best price, service, etc., and place orders directly with these businesses.”

And step five offers businesses opportunities to “market your business to state agencies.”

The state contracts registry is interesting. They’ve taken the time to assign codes to nearly every type of business that might do business with the state, leaving one ton wonder why the following businesses might be contracting with the state:

  • Time pieces, jewelry and gemstone products
  • Apparel, Luggage and Personal Care Products
  • Live Plant, Animal Material and Accessories and Supplies
  • Musical Instruments and Games and Toys and Arts and Crafts and Educational Equipment and Materials and Accessories and Supplies
  • Drugs and pharmaceutical products
  • Domestic Appliances, Supplies and Consumer Electronic Products
  • Financial and Insurance Services
  • Electronic components and supplies

The state claims it will pay vendors within two to three days if the business accepts VISA cards for payment, however is can costs businesses a 2 to 3 percent surcharge of the amount of the bill, to accept VISA payments.  On a $50,000 bill, the VISA surcharge would be $1,500, right off the top of the payment to the business. And for standard billing payments by the state, the state pays many vendors in excess of 60-days.

So what’s the problem with all of this? I’ve heard from several state agencies that they have been told to shop outside of California because it’s too expensive to do business in this state.

– Katy Grimes

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