Opening a port of entry
Terrence Payne’s 48-year-old family grocery store was lost in a blaze of urban rage. A bid to rebuild it was strangled by red tape. A subsequent consulting operation struggled against closed doors.
Some people might have taken the hint and decided that they weren’t meant to be their own boss.
Instead, Payne tried again.
The simple idea he hatched in 2003 grew out of Payne’s frustration with the expensive and confusing contracting process: He recalled spending $1,500 to bid on a contract that was awarded to someone else, but no one bothered to tell him. His new business would give people the tools to get inside the decision-making loop when corporations and government agencies pass out work, and make sure they stayed there.
He expected the execution to be difficult. Software had to be created to sort through contract requirements and businesses’ capabilities. Layers of bureaucracy had to be pierced. Clients had to be found.
Payne took on the marketing, hired a programmer to write the software and found a partner to manage the business, called Taylor’s Marketing & Management in honor of one of Payne’s grandfathers.
“We were the three legs of this project,” Payne said of lead programmer Ashfaq Chougle and partner Teresa Wallette. “We taught it to stand. We taught it to walk. Then we taught it how to run.”
After countless refusals, Payne landed the nation’s busiest trade gateway, the Port of Los Angeles, as the most prominent customer for the software, which helps public agencies and large companies identify qualified small companies with which they can do business. It also simplifies and standardizes proposal writing for small firms.
Among other things, the port uses the software, called E-DiversityXchange, for tracking hundreds of millions of dollars in contract and subcontract awards to ensure that small and minority businesses that were supposed to benefit are actually receiving their share of the work.
Payne’s company has provided the port with an important tool for ensuring that smaller businesses aren’t forgotten when major contracts are awarded and projects finally get underway, said Margaret Hernandez, who directs the port’s contracts and purchasing.
“We wanted to make it clear to the contractor community that we are very interested in creating small-business opportunities,” Hernandez said. “We want to provide chances for as many of those businesses as possible, especially those in our local area, and his software is a big help.”
Almost 17 years have passed since Payne’s store burned in the 1992 Los Angeles riots. It was called Taylor’s Corner Grocery, bought in 1944 by Payne’s grandparents, Theodore Roosevelt Taylor and Otrie Lee Taylor.
Stranded by a citywide curfew, Payne spent the night of April 29 in the spare bedroom of a nearby Latino family, listening to his grocery’s canned goods explode from the heat.
Payne, a Los Angeles native and a graduate of Morningside High School, worked in sales and marketing before buying the South Los Angeles store at 53rd and San Pedro streets from his grandparents.
Trying to gather the $1.1 million in loans and grants that he needed to rebuild the grocery was almost as maddening as the night it burned down, Payne said. Groups designed to help, such as Rebuild L.A., were confusing and ultimately unhelpful. When he heard about pools of money, it usually was too late. Banks had seemingly endless requirements.
“I was never contacted in a timely manner,” Payne said. “When I submitted proposals, I was never notified when or if the contract was awarded. . . . It was always ‘We’ll get back to you,’ but the letters never arrived. The calls never came.”
Five years later and $200,000 short, Payne gave up and became a consultant, helping find new businesses worthy of development using federal money that passed through the local Urban League. In 1999, Payne launched Taylor’s Marketing & Management to do similar work on a wider scale, but by then the federal money was running out.
As Payne cast about for something new, he pondered as many lessons from his family as he did business lessons. One of the earliest came from an uncomfortable afternoon as a child in mid-’60s Los Angeles, in a white neighborhood that Payne remembers as hostile to African Americans.
Payne’s grandfather Taylor, who also owned a gardening business, stopped his truck and calmly walked up to a white homeowner who was watering his lawn.
Payne recalled his shock as he heard his grandfather ask the owner how much he wanted for the house. The man politely declined to name a price but accepted the offer of Taylor’s phone number if he ever changed his mind.
Payne remembers his grandfather driving off, seemingly oblivious to the kids hurling rocks at the truck. Payne thought his grandfather was losing his mind, until Payne answered the phone at his granddad’s house and heard that homeowner asking what the old man had in mind for a price.
The message wasn’t lost on Payne: “If you know how to present yourself, and you went to the right people, they would take you seriously. Everything was for sale.”
Product finally in hand in 2003, Payne approached some of the West Coast’s biggest contractors and some of its largest public agencies. He was expecting them to marvel at what his small firm had produced.
Mostly, potential clients just weren’t interested.
“We were told that the systems they used already provide too much information and too much detail,” Payne said. Another company told him it didn’t want a lot of information about potential subcontractors. “They didn’t care about the problem,” he said.
Technology development expert William Lyte said the process of choosing contractors and subcontractors was filled with time constraints, first to get a proposal before the decision makers and then to get the project completed on time and within budget.
That, Lyte said, is where small companies that don’t have an inside connection can get run over and forgotten. The pressures are even greater in a recession, he said, when budgets are scaled back.
The contract decision makers “are going 90 miles an hour,” said Lyte, a co-founder of Technoplex Group, a business consulting firm in San Pedro.
“If you can’t get your proposal to them exactly the way they want it, if they have to rewrite it and refine it, they won’t bother. They will pick someone else.”
The breakthrough came in 2006 from a source that seemed the least approachable, the Port of Los Angeles. It wasn’t just a big and intimidating entity; many outsiders thought they needed a glossary of maritime lingo to understand what was being discussed.
But the port was looking for what Payne had to offer.
“We started out using it as a contractor database, where businesses could register with us,” Hernandez said. “We could send them e-mail when there were contract opportunities. Then, we expanded our use to capture data on the contractors working for us and the level of their small-business participation.”
To Lyte, whose biggest push these days is encouraging local and California firms to try to fill some of the port’s technological needs for green cargo movement, it’s an incredible tale.
“To have a guy come out of a grocery store background and deliver the top procurement program and contract management software for an agency like the Port of Los Angeles is something that just constantly amazes me,” Lyte said.
Payne, who projects revenue of $750,000 to $1 million this year, feels a little bit like his grandfather.
“He had no business or economics degree, but he had this ability to strike deals,” Payne said. “He just traveled on hopes and a prayer -- and made it work.”
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BEGIN TEXT OF INFOBOX
Taylor’s Marketing & Management
Business: The firm helps big companies and public agencies find small and minority firms with which to do business. The Los Angeles consulting firm also helps small companies that want to work with larger operations.
Partners: Terrence Payne, Teresa Wallette
Revenue: $750,000 to $1 million, 2009 estimate
Employees: One to five, depending on the workload
Website: tmminfo.biz
