Supplier diversity is not charity. It is a process by which companies can improve their business. When properly implemented, supplier diversity can lower costs and increase margin and revenue.
Supplier diversity can help your business in several ways:
- By increasing the number of suppliers with which you do business, you may lower your overall procurement costs. By increasing the pool of your suppliers, you will increase competition for your business. Women and minority business enterprises (W/MBEs) are forming and growing at a fast rate, and aligning your business with a growth sector is a great strategy.
- If your company is a consumer company, supplier diversity will help your company reach new customers. In the process of doing business, your business will identify better approaches to relate to various demographic segments in your community.
- If your company is a business-to-business co mpany, you probably already know that other progressive businesses are including diversity requirements in their RFPs. Your business is at a competitive disadvantage if you don’t have a good supplier diversity record.
- If you are a business-to-government company, many supplier diversity programs are mandated. Progressive governmental agencies are looking for exceptional performance when it comes to supplier diversity.
- Supplier diversity can increase sustainability of a local economy by broadening and strengthening the economic base of the region. This is most quickly done by working with people who have formerly been excluded and/or oppressed.
This short list of factors is not inclusive of all of the reasons to promote supplier diversity. But, it certainly gives cause for you to ponder why supplier diversity can be a positive for any business.