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Merchant Ship Collective | The Launch Dock
“Where small businesses learn the truth about power, policy, and opportunities that actually matter.”

When One Contract Replaces Twenty: How PPPs Accelerate Market Consolidation

If you’ve ever wondered why it feels harder every year for small businesses to win local work, the answer is bigger than the economy, competition, or timing.

Across the country, something else is happening:

Entire local markets are being consolidated through Public–Private Partnerships (PPPs).

Instead of multiple businesses sharing opportunities, a single master contract is handed to a national company — sometimes for 5, 10, or even 20 years. The “partnership” becomes a gatekeeper, and small businesses lose access overnight.

This issue breaks down exactly how that consolidation happens…
and why it’s not an accident.

What Market Consolidation Looks Like in Real Life

Before we talk policy, let’s make it simple.

Market consolidation happens when:

• One company replaces many.

• One contract replaces dozens.

• One decision eliminates years of opportunity for locals.

It’s not just one industry.
It’s everything:

• Building maintenance

• Municipal cleaning

• HVAC and electrical

• Landscaping and snow removal

• Food service and catering

• Transportation and logistics

• IT support and cybersecurity

• Printing and marketing

• Public health services

• School technology and data systems

And once a PPP wins that master contract, the door often stays closed for years.

How PPPs Create Market Consolidation

1. A city or agency bundles multiple services into one “comprehensive contract.”

This is sold as “efficiency.”

But bundling creates contracts that:

• Small vendors cannot staff

• Local businesses cannot finance

• Only national firms can fulfill

This is the first point where the market tips.

2. The PPP wins a long-term contract — often 5–20 years.

Long-term agreements benefit large corporations with:

• More capital

• Larger labor pipelines

• Preexisting government relationships

• Advanced proposal teams

Small businesses can’t compete with that scale.
And they shouldn't be expected to.

3. Once awarded, the PPP becomes the exclusive provider.

This eliminates:

• Local small business competition

• Opportunity diversity

• Community wealth circulation

GAO reports show that these “mega-contracts" sharply reduce opportunities for smaller firms and limit competitive entry (Government Accountability Office, 2017).

4. The PPP then integrates proprietary systems.

This is where the trap tightens.

A PPP installs:

• Custom software

• Special equipment

• Private data systems

• Vendor-locked tools

Small businesses cannot integrate with these systems without paying fees, meeting unreasonable requirements, or surrendering their autonomy.

This is not efficiency — it’s exclusion.

5. After integration, the PPP controls the entire pipeline.

They become the gatekeeper for:

• Hiring

• Subcontracting

• Data access

• Pricing

• Vendor eligibility

In many cases, subcontracting is:

• Minimal

• Unfair

• Inaccessible

• Or offered at unsustainably low margins

This creates a structural disadvantage for local businesses (U.S. Small Business Administration, 2023).

6. Renewal clauses keep the PPP in place indefinitely.

Some PPP contracts include:

• Automatic renewals

• Extension clauses

• Performance audits conducted by the PPP itself

• Exclusivity agreements

By the time the public learns the contract exists, it’s already been renewed.

Real-World Consequences for Small Businesses

Lost Contracts

Businesses that served their communities for decades suddenly lose core revenue.

Shrinking Local Economies

Local dollars are diverted to national corporations with no community roots.

Reduced Consumer Choice

With fewer providers left, prices rise and quality stagnates.

Higher Barriers to Entry

New entrepreneurs face:

• More paperwork

• Harder certification

• Stricter insurance requirements

• Higher startup costs

Loss of Community Resilience

When small businesses disappear, towns lose:

• Job creation

• Skills

• Generational wealth

• Local expertise

PPP consolidation reshapes entire economic ecosystems — often permanently.

Why Government Allows Consolidation to Continue

Efficiency narrative

Agencies are told a single vendor is easier to manage.

Risk-shifting

Private companies promise to “absorb the liability.”

Budget pressure

PPPs present themselves as cost-savers.

Lobbying

Corporations influence procurement policy more than small businesses ever can.

Emergency use

Emergencies create “temporary exceptions” that become permanent structures (USDA, 2025).

What Small Businesses Can Do

This series will go deeper into the solutions, but here’s your preview:

• Advocate for unbundled contracts

• Push for local vendor set-asides

• Demand transparency in PPP renewal cycles

• Track public meetings and planning sessions

• Build coalitions with other small businesses

• Use public comment periods strategically

• Watch for early warning signs like “efficiency studies”

You’re not powerless — you just need information.

That’s why we’re doing this series.

Call to Action

Next week in The Launch Dock:

-How PPP-controlled data systems disadvantage small businesses
-How "proprietary platforms" block local competition
-Why digital infrastructure contracts are the new battleground
-Tools for small businesses to identify and challenge data-based exclusion

Knowledge is the first defense.
Collective power is the second.

And we’re building both — together.

In solidarity,

Lyndsay LaBrier
The Merchant Ship Collective

References

Government Accountability Office. (2017). Animal disease surveillance: Improvements needed in U.S. efforts to control highly pathogenic avian influenza. https://www.gao.gov/products/gao-17-360

United States Department of Agriculture. (2025, February 26). USDA invests $1 billion to combat avian flu and reduce egg prices [Press release]. https://www.usda.gov/about-usda/news/press-releases/2025/02/26/usda-invests-1-billion-combat-avian-flu-and-reduce-egg-prices

U.S. Small Business Administration. (2023). Small business procurement scorecard FY2022. https://www.sba.gov/document/support-small-business-procurement-scorecard

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