There\u2019s an old saying in corporate America that nobody gets fired for buying IBM. Buying from the big players is viewed as a safe move. And large companies have a reputation for stability and reliability.\r\n\r\nBut there are also major advantages to buying from small suppliers. Here are some of the reasons you should take a closer look at small vendors.\r\n\r\nSocial responsibility\r\nDiversity isn\u2019t just for hiring and investment portfolios anymore. Social responsibility has become part of the procurement agenda.\r\n\r\n[ Also on CIO.com: 6 outsourcing tips for small businesses\r\n ]\r\n\r\nIt\u2019s important to note that limiting your procurement to the Fortune 500 means you are missing most companies. According to the U.S. Small Business Administration (SBA), small businesses (500 employees or fewer) account for 99 percent of all firms and 41 percent of private-sector payroll. In 2012, there were over 240,000 small firms in the high tech sector, according to the SBA, and there are likely even more today.\n\t\t\tThere\u2019s an old saying in corporate America that nobody gets fired for buying IBM. Buying from the big players is viewed as a safe move. And large companies have a reputation for stability and reliability.\n\nBut there are also major advantages to buying from small suppliers. Here are some of the reasons you should take a closer look at small vendors.\n\nSocial responsibility\nDiversity isn\u2019t just for hiring and investment portfolios anymore. Social responsibility has become part of the procurement agenda.\n\n[ Also on CIO.com: 6 outsourcing tips for small businesses\n ]\n\nIt\u2019s important to note that limiting your procurement to the Fortune 500 means you are missing most companies. According to the U.S. Small Business Administration (SBA), small businesses (500 employees or fewer) account for 99 percent of all firms and 41 percent of private-sector payroll. In 2012, there were over 240,000 small firms in the high tech sector, according to the SBA, and there are likely even more today.\n\nThe U.S. government has allocated a percentage of government spending to companies owned by minorities, including women, veterans and other historically disadvantaged groups, to provide economic empowerment. In fiscal year 2015, 25.8 percent of U.S. contracting dollars went to small businesses, with the Departments of the Interior, Transportation and Agriculture serving as notable buyers from small companies.\n\nAnd the trend has spread to corporate America, with many companies publicly committing to supplier diversity to achieve their corporate social responsibility objectives. AT&T, Dell, GM and Microsoft, for example, currently spend over $1 billion per year on diverse suppliers according to the corporate advocacy organization\u00a0the Billion Dollar Roundtable. This procurement strategy is motivated by social responsibility but that is only part of the story.\n\nDeep industry understanding\n\nStarwood Hotels, which has more than 1,300 properties operated by over 150,000 staff, has increased purchases from small suppliers over the past few years. When it was looking for an eProcurement system, the company ultimately settled on software from Birchstreet Systems, a company with approximately 115 employees \u2014 but not before running a number of vendors through a competitive selection process that culminated in full-day demonstration sessions\n\nHow did Birchstreet stand out to Starwood Hotels? \u201cThey really knew the hospitality industry,\u201d says Jim De Filippo, Director of IT Supply Chain at Starwood. Birchstreet\u2019s eProcurement system is used by Hilton Hotels, Marriot Hotels, Fairmont Hotels and the Four Seasons. \u201cSome companies may say they can find out how to meet our needs. Birchstreet was ready to go,\u201d says De Filippo\n\n\u201cThere are several benefits in buying from small suppliers,\u201d De Filippo says. \u201cI find that smaller companies are often more interested in learning the business and often more willing to accommodate one-off requests,\u201d he says. At Starwood, one-off requests include supplying computer accessories to a single hotel property. Large suppliers may discourage such orders while smaller suppliers are keen to build their reputation.\n\n\u201cOur small suppliers benefit from being able to mention Starwood Hotels as a client so that\u2019s an incentive for them to perform well,\u201d De Filippo says.\n\nManaging risk \n\nConcerns over financial and operational viability are an oft-cited reason why large, established companies are preferred by many procurement professionals.\n\n[ Also on CIO.com: CIOs: Match security plans to your company's 'risk appetite' ]\n\nOne way to mitigate the risk of operational failure is to find small suppliers that use infrastructure from large firms. For example, ecommerce startup Hubba, which offers a platform for retailers and suppliers to share product information,is built on Amazon Web Services.\n\nFinancial viability is another significant concern for companies considering small suppliers. Unlike their publicly traded competitors, small companies are generally under no obligation to provide financial statements.\n\nAbsent that information, how can you assess your suppliers\u2019 financial health? Buyers may ask for a statement of the company\u2019s cash levels or use an independent service such as Dun & Bradstreet, which draws on banking data, credit scores and other data sources.\n\nRemember, too, that a small supplier may grow over time. From 2012-2015, over 125 small businesses that supply Dell grew so much that they exceeded the \u201csmall company\u201d definition. For example, in 2000, Dell started working with OrangeDoor, a woman-owned integrated marketing agency with 3 full time employees. By 2016, the agency had grown to over thirty employees. Facilitating that growth with a vendor over time will translate to deeper understanding and more effective working relationships.\n\nFinding diamonds in the rough\n\nSmall firms don\u2019t have the resources to sponsor conferences, golf courses or TV commercials. How can IT managers searching for solutions find these small companies?\n\nLook for third-party reports that identify up and coming players. Research firm Gartner\u2019s Cool Vendor report identifies innovative and impactful small companies. Inc Magazine\u2019s \u201cInc 5000\u201d list includes high growth companies in multiple industries, including 1,000 companies in the IT services category. Also, look for individuals from small companies who are speaking at conferences and contributing to the industry conversation.\n\nFinally, consider joining a specialized industry association to find certified diverse suppliers. \u201cDell works with government and multicultural organizations to actively identify and grow small businesses, including the Small Business Administration, the National Minority Supplier Development Council and the Women\u2019s Business Enterprise National Council.\u00a0 Additionally, there are several matchmaking opportunities, regional events and conferences that bring small businesses in contact with top decision-makers at their potential client companies,\u201d says Mark Pringle, vice president of World Wide Procurement at Dell.