President Joe Biden's "Made In America" executive order promises sweeping changes in how our government supports American manufacturers and producers. In his speech announcing the initiative, the president singled out small businesses, which account for 44 percent of U.S. GDP and employ nearly half of all American workers, at least three times--indicating he fully understands what's at stake, and how his administration can help drive the growth of small businesses and by causation, growth of communities and the economy.
With many local entrepreneurs hurt by the pandemic, President Biden's Executive Order stands as a document of hope and strategic action for small businesses. With an eye on the federal government as a client, this is an opportune time to grow an existing business, or even start one.
Here are five ways that small businesses stand to benefit from Biden's "Made in America" plan.
1. More market intelligence.
The EO provides for a public website that answers the questions every smart business owner has about procurement: Which companies applied for waivers? For what products? Why was the waiver denied? President Biden has already appointed Celeste Drake, a trade expert, to head the "Made in America" Office. This level of transparency is key and the advantage goes to small businesses, who typically don't have access to this kind of strategic data, giving them a window on the competition.
2. Access to an ocean-size market (that's actively inviting small biz owners to the party).
The federal government spends close to $600 billion a year on procurement of goods and resources of all kinds, and some of that could be yours. Agencies are charged with ensuring small businesses get a better shot at winning more of those dollars. In addition to the website, the new guidelines promise less red tape (which will cut costs) and the establishment of the aforementioned "Made in America" office to help boost American manufacturing. The EO compels federal agencies and contractors to purchase more U.S.-manufactured products and, in what could have far-reaching benefits, agencies must now identify and list a database of American small and medium-size businesses that produce goods and materials that each agency purchases.
3. The ability to charge sustainable prices.
In the EO, Biden instructs agencies to consider, under certain circumstances, paying more for goods made in the U.S. if it'll help foster the American producer-based economy. We've seen how difficult it is to compete with the off-shore manufacturers and this is one way to level the playing field.
4. The ability to sell verified made-in-the-USA products more nimbly.
Currently, more than 50 percent of a product's cost must be of American origin to qualify as made in America. President Biden's EO will close loopholes that allow companies to fall below this threshold and still claim Made in America status. Whether you're starting a business or are in growth mode, small-business owners making goods produced here at home can pivot quickly to gain verification to be in line with the EO--eventually increasing sales, and deepening trust between you and your consumers.
5. Power of the bully pulpit.
When the president speaks, people listen. Our state and government officials have invested serious political capital in celebrating American manufacturing, supporting small businesses, and competing with foreign countries, China in particular.
Small businesses can help rebuild America's supply chain. During the pandemic, everywhere we looked, products were stuck overseas. Supply chains were crashing. Factory upon factory disappeared, taking thousands of American jobs with it. There's an incredible amount of work to be done to restore our supply chains and, with the government pledging its support, it's a space where small businesses can intentionally move in to.
As business owners with a combined 40 years of experience in Blockchain, manufacturing, retail, apparel, and the tech startup space, we know the demand and interest in American-made products and a system that promotes a more equitable distribution of wealth. One of the major engines for this transformation is small and medium-size businesses. Building upon "Buy America" statutes passed in 1933 and 1982, President Biden's executive order is seismic in its scope and potential.