Diversity Supplier

What is a Diversity Supplier?

A diversity supplier is a company run and owned by members of historically underrepresented groups, such as women, veterans, LGBTQ+ people, or people with disabilities. To qualify as a diverse supplier, businesses often need certification from recognized organizations that verify the ownership and management by these individuals. Incorporating diverse suppliers into your supply chain helps promote supplier diversity and fosters inclusive business growth.

The Importance of Diversity Suppliers

The importance of diverse suppliers lies in their ability to drive innovation, promote business growth, and create a more inclusive supply chain. By partnering with certified diverse suppliers, companies foster supplier diversity and strengthen their business strategy by tapping into new markets and perspectives. Supporting minority-owned and women-owned business enterprises helps promote supplier diversity initiatives that contribute to long-term economic sustainability and create opportunities for underrepresented communities.

Enhancing Supplier Diversity

Engaging with diversity suppliers helps to:

• Promote inclusivity and social equity within the business ecosystem by engaging with diverse suppliers.
• Drive economic growth by supporting certified diverse suppliers, including minority-owned and women-owned business enterprises.
• Strengthen supply chains by incorporating diverse business owners from underrepresented groups.
• Foster innovation through a broader range of perspectives and experiences.
• Contribute to long-term sustainability with effective supplier diversity programs as part of a strategic business plan.
• Support global supplier diversity initiatives for a more inclusive supply chain.

Benefits to Organizations

Organizations that partner with a supplier diversity program can:

• Access new markets and networks through partnerships with diverse business owners and qualified diverse suppliers.
• Reflect the diversity of their customer base within their supply chain by integrating diverse suppliers, including minority-owned and women-owned business enterprises.
• Meet corporate social responsibility and diversity procurement goals by promoting supplier diversity initiatives and supporting diverse supplier spend.
• Strengthen their business strategy and foster innovation through a more inclusive and diverse supply chain.

How to Identify and Work with Diversity Suppliers

Certification Process

Diversity suppliers typically hold certifications from entities such as:

• National Minority Supplier Development Council (NMSDC)
• Women’s Business Enterprise National Council (WBENC)
• National Gay & Lesbian Chamber of Commerce (NGLCC)
• National Veteran Business Development Council (NVBDC)

Incorporating Supplier Diversity Programs into Procurement

Organizations can:

• Set procurement goals focused on engaging certified diverse-owned businesses, including minority-owned and women-owned business enterprises.
• Attend trade fairs and leverage databases to connect with qualified diverse businesses and promote supplier diversity initiatives.
• Develop mentorship programs that foster business growth for diverse business owners and support the sustainability of effective supplier diversity programs.
• Track diverse supplier spend to measure the impact of their supplier diversity efforts on the supply chain.

Frequently Asked Questions (FAQs)

What does supplier diversity mean?

Supplier diversity refers to the proactive inclusion of businesses owned by underrepresented groups, such as minority-owned, women-owned, veteran-owned, and LGBTQ+ enterprises, in an organization’s supply chain. It ensures that diverse suppliers have equitable opportunities to compete for contracts and contribute to the supply chain, fostering innovation and promoting social equity. By incorporating supplier diversity initiatives, companies can enhance their business strategy, meet diversity procurement goals, and support the growth of diverse businesses within their industry.

Why is it important for companies to include diversity suppliers in their procurement process?

It is important for companies to include diverse suppliers in their procurement process to drive innovation, access new markets, and demonstrate a commitment to social responsibility. It also aligns with many customers’ values and expectations.

How does a supplier become classified as a ‘diversity supplier’?

A supplier becomes classified as a diversity supplier by obtaining certification from an accredited organization that verifies the business is majority-owned and operated by individuals from underrepresented groups.

What are the challenges faced by diversity suppliers?

Diverse suppliers often face challenges such as limited access to capital, reduced networking opportunities, and a lack of visibility among potential clients. These barriers can hinder their business growth and ability to participate in large supply chains. However, obtaining supplier diversity certification and forming partnerships with corporations through supplier diversity initiatives can help diverse business owners overcome these obstacles, allowing them to access new markets and improve their competitive standing.

By prioritizing partnerships with diverse suppliers, companies contribute to a more equitable and diverse marketplace while enjoying the benefits of varied perspectives and increased competitiveness. It’s a strategic approach that aligns with contemporary values and the push toward more inclusive economic growth.