How Minority-Owned Businesses Can Grow Through Supplier Diversity Programs

How Minority-Owned Businesses Can Grow Through Supplier Diversity Programs

Supplier diversity programs can help you expand your business, giving you greater exposure and access to new audiences.

June 26th, 2020 | Rodika Tollefson

Access to the market is one of the top challenges for minority-owned businesses, but supplier diversity programs can help combat economic inequality by promoting businesses owned by people of color. Similar to government agencies’ diversity programs, many companies have their own programs designed to make their supply chain more inclusive and diverse, which can help level the playing field for minority-owned businesses.

“Supplier diversity programs are tools to get you exposure and access to audiences you might not be able to reach otherwise,” says Sydni Craig-Hart, a fourth-generation entrepreneur and multi-award-winning small-business marketing consultant.

Craig-Hart speaks from experience. Her California-based company, Smart Simple Marketing, has been working with enterprise corporations since 2013 and has been certified as a minority-owned business (MBE) and woman-owned business (WBE) since 2015. The company had doubled its revenues for two consecutive years — and Craig-Hart attributes much of that success to selling to large companies who she’s connected with through diversity programs.

“Becoming a supplier to a large organization is a great revenue opportunity for small businesses,” she says, (According to PRGX, companies on the Forbes 2000 list spend $16.6 trillion annually on vendor relationships). “If you’re willing to put in the work and build relationships, and really involve yourself in the community, this could be a game-changer for your business.”

How Supplier Diversity Programs Work

The supplier diversity programs differ for each corporation or government agency, but have one thing in common: making their supply chain more inclusive and diverse by encouraging the use of vendors that are historically overlooked, such as businesses owned by minorities, women, the LGBTQIA+ community and veterans.

The companies that offer these programs “have made a commitment to ensure that their supply chain reflects their community, customer base and employee base,” says Michelle Sourie Robinson, president and CEO of the Michigan Minority Supplier Development Council, one of 23 affiliates of the National Minority Supplier Diversity Council.

Many — but not all — of the privately-owned companies that have supplier diversity programs require vendors to be certified as a diverse firm, typically by a third-party organization such as the National Minority Supplier Diversity Council. Government agencies often have their own certification processes for diversity programs.

Some of these programs also offer matchmaking, business development, training and coaching to promote economic impact to the local communities. The program administrators don’t typically do the procurement — rather, their role is to be a resource. Additionally, many large corporations have a dedicated resource, such as a small business liaison officer (SBLO) or diversity liaison officer on staff to execute on supplier diversity.

“These programs help open doors for you to participate in projects that you may not otherwise have the chance to,” says Yvonne Garth, president and CEO of Florida-based Garth Solutions, Inc., a project management and consulting company that specializes in large construction and capital improvement projects.

Added Advantage as a Subcontractor

Garth Solutions has multiple MBE and WBE certifications, both through the Florida State Minority Supplier Development Council and several government agencies, such as the Florida Department of Transportation and Broward County, Florida. Garth says supplier diversity has helped her company grow from a one-person business to employing 35 people and billing $3.5 million in annual revenues.

One way Garth Solutions works on government projects is by becoming a subcontractor to larger firms that bid on contracts. Garth says that her company’s MBE certification often creates a differentiator and sometimes even becomes the tiebreaker for the winning bid.

“These programs incentivize large companies to carve out a portion of the work that they would normally perform in-house,” she says.


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