Oak Ridge is a small city, built in 1942, by the Federal Government in order to build the first nuclear weapons, a business they're still in, along with weapons and energy research, and research of other kinds.
Nearly every business here is related to supporting the Federal Government's facilities here in Oak Ridge. The local Home Depot does a lot of business with those folks. Granted, they are private contractors with the Federal Government, however, they usually get their purchase orders for supplies, product and consumables from the facility they're working at - i.e., one of the local Federal Government facilities.
Home Depot here in Oak Ridge made the majority of its bulk sales to the local facilities, i.e., the Federal Government. Since Home Depot is now refusing to do business with them, that business will be taken back to the folks they used to do business with. The primary reason Home Depot built it's facility here was to do exactly the kind of business that they are now refusing to do.
OK, I'm going to read back over this and see if it was clear enough. I realize there's a few words of more than two syllables....
But it sounds like you're saying that those small contractors are making their purchases with federal purchase orders instead of their own capital. That would be a problem -- but would make me wonder why they do that. Might they rely on federal POs because it would take too long for the feds to reimburse them? If so, that would prove the wisdom of Home Depot's decision not to do business with a slow-paying, strings-attached customer like the federal government...