Minority-owned businesses and big corporations are not working with each other enough in the Charleston region, and it's time to bring them closer together, Mayor Joe Riley said.
One possible solution: A new region-wide effort to create more opportunities for small companies owned by women, blacks and other minorities.
The push is being led by the Berkeley-Charleston-Dorchester Council of Governments, which plans to devise a regional strategy to encourage large mainstream businesses to diversify their base of suppliers and subcontractors.
Riley, who also is chairman of the council, announced the initiative Thursday. While existing programs aimed at helping local minority-owned businesses have had some success, Riley said they are fragmented, which limits their impact on incomes and the region's economy. "To really be successful, we have to bring them to scale — move from tactically to strategically — and move this forward," he said.
Riley said the Council of Governments will work with minority-business expert Mel Gravely of the Institute for Entrepreneurial Thinking to create a strategic plan for the entire region. Half of the $150,000 cost will be raised privately, with the rest coming from public sources.
Riley said the three-month study will allow officials to step back, "look at all the pieces and potential you have, and pull it together."
According to the latest figures from the U.S. Commerce Department, South Carolina had about 37,000 minority-owned business in 2002, or 13 percent of the total, but they accounted for 4 percent of the gross business receipts.
Milwaukee-based Johnson Controls Inc., a multinational company that makes climate control systems and car parts, is a big proponent of farming out jobs to qualified minority-owned enterprises. It's now a necessity for any business that wants to win work with the "Big Three" automakers, said Jeff Messick, a local executive with Johnson Controls.
"It's not just the right thing to do," he said. "It helps us grow, and it helps us retain customers.
Messick said he has been talking about ways to increase minority hiring with the city of Charleston and the Medical University of South Carolina for about three years. The "business case" can be compelling, he said. For example, Johnson Controls has found that it can save money by working with more minority-owned contractors.
"Many times they have lower overhead," Messick said. "They're quicker to the job, and many times they'll do it cheaper."
One problem is that not enough minority-owned companies are equipped to take on a contract with a Fortune 500-type business. "They're close," he said. "But we need to get them going a lot faster."
In many ways, Riley said, Charleston has had to play catch-up compared to other cities with large concentrations of minorities. He noted that during the Jim Crow era, the city was probably one of the largest in the South that was not home to a prominent black institution — such as a college or bank — that could produce and attract business leaders and role models.
"We didn't have that in Charleston," Riley said. "We need that."
Charles Van Rysselberge, president of the Charleston Metro Chamber of Commerce, said recruiting large mainstream companies will be the key to making more inroads. "I feel our biggest challenge here ... is to identify a core small group of business to commit to this and grow from there," he said.
Robyn Hamilton, president and chief executive officer of the Carolinas Minority Supplier Development Councils Inc., said that's one of the reasons her Charlotte-based group is organizing a big trade show for August in North Charleston: to cultivate relationships between minority-owned businesses and big companies such as Starbucks and Bi-Lo. "They don't travel in the same circles. That's the reality," she said. "So people have to be deliberate."