Supplier diversity initiatives encourage an equitable approach to procurement. When a company invests in a diverse supplier base, it invests in society. For local economies, small businesses are important, and for the economic empowerment of people of all backgrounds, local economies are important. Investing in small businesses may, in turn, encourage job development at the local level, especially in times of such strong economic need.
What is Supplier Diversity?
Supplier diversity is, in general, a business practice that ensures a diverse supplier base for any business or organization in the procurement of products and services. It emphasizes the development of a diverse supply chain that aims to ensure the participation of diverse groups in procurement plans. In the broadest context, a diverse supplier is a company owned and operated by a person or organization that is part of a group that is historically underrepresented or underserved.
Supplier diversity programming adds economic benefit because it promotes the growth of diverse companies. Usually, small organizations face challenges that threaten their start-up and sustainability activities, such as access to capital and networking opportunities, and these pressure points can be alleviated by successful supplier diversity strategies. Supplier diversity not only helps underrepresented firms, but also uplifts the communities where these companies are based through job growth, higher salaries, and tax revenue.
As small businesses expand, so will the US economy. Since the majority of diverse companies are small businesses, they contribute to their communities’ economic recovery and sustainability. Research shows that businesses see a rise in market share as their spending grows and differentiates. In particular, the correlation between highly diverse spending and increased market share was markedly superior to the ROI of low-diversity spending firms. The truth is that inclusive supply chains offer a strategic advantage beyond social responsibility and economic impact metrics, as progressive organizations that have already adopted a successful strategy have discovered.
A dedication to supplier diversity helps a business because it:
- Promotes imagination by introducing new products, services, and solutions
- Provides different outlets to procure goods and services from
- Drives competition between the company’s current and future vendors (on price and service levels)
- Enables a company to seize emerging business expansion opportunities and shifting demographic realities presented by new customers
- Helps grow local economies and small business sales opportunities
Business certification is a significant achievement in a supplier’s existence because it certifies that the organization is owned, operated, and regulated by a diverse qualifying community. In general, certified suppliers include women-owned and operated firms, firms owned by members of underrepresented and socially and economically marginalized communities, and veterans. In order to determine if a vendor meets the criteria to be considered a diverse business, businesses with supplier diversity programs also rely on generally recognized certifications.
We are proud to announce that we are now an SBA-certified Women-Owned Small Business (WOSB). The WOSB certification is a Small Business Administration (SBA)-a coordinated program that was developed to provide women business owners with a level playing field. We hope to see other women-owned businesses join our ranks soon and we look forward to opportunities with organizations seeking to diversify their supply chain. Contact us today if you would like to learn more about how you can work with us.