Convincing your company to support supplier diversity
So you think that diversifying your supplier base is a good idea for your business. But what if your company’s decision makers don’t share your enthusiasm? It’s critical that you present a proper business case for supplier diversity that explains the benefits of developing a supplier diversity program. Below you’ll find several common talking points that will help you gain support within your organization.
Know your customers
If you are in a Business to Business industry, we suggest that you simply follow the value chain and identify your company’s top revenue generating customers. Since 68% of the Fortune 100 are national corporate members of NMSDC, it is very likely that your top customers will have strong supplier diversity programs. Your development of a results-driven minority supplier development strategy will prove valuable to your corporate sales team.
If you are in a Business to Consumer industry, we suggest that you study the success of cause marketing strategies. In today’s information era, consumers know more about the brands they buy from and demand more from them ethically than ever before. In fact, 76% of today’s consumers believe it is OK for brands to support good causes while making a profit, up 33% from just four years earlier.
For this reason, corporations have begun heavily embracing the concept of cause marketing. By creating strong diversity programming and then actively promoting it as a component of brand identity, companies are finding a competitive edge in the marketplace. Corporations are quickly discovering that in situations where their brand’s goods are similar in price and quality to their competitors, consumers favor the brand that supports an important social cause.
Make supplier diversity the centerpiece of your cause marketing strategy
Thirty-four percent of all consumers believe that economic development is the most important social issue for companies to address, topping both environmental concerns and human rights. Therefore, it goes without saying that your customers and prospects would be quick to embrace your company’s support of economic development throughout often historically disadvantaged minority communities. By providing economic opportunities to underserved populations and then marketing your commitment to economic growth, you can add value impacting customer satisfaction and sales.
Let efficient MBEs pass on the savings to you
As mentioned elsewhere on this site, there are also tangible financial benefits to be gained from working with minority suppliers. Minority suppliers tend to be leaner and more agile than their majority-owned counterparts, effectively doing more with less. This allows MBEs to pass on their operational cost savings to you, the end client. That’s simply smart business.
Get ahead of the demographic shift in our country
By the year 2043, the racial and ethnic groups that today we call minorities will collectively become a majority of the U.S. population. If your company expects to sell your products and services to these minority groups, you should be prepared to contribute to their economic well-being. After all, the demand for your products is limited first and foremost by the size of the market for them. If you’re not appealing to minority groups now, how will that affect your business when these groups become the dominant economic force in our country?
Supplier diversity is a natural extension of what you already do
U.S. corporations have been required to offer employment opportunities to all individuals — regardless of race, color, religion, sex, or national origin — since the inception of the Equal Employment Opportunity Act of 1972, which built upon the Civil Rights Act of 1964. Today, this legislation is baked into our national consciousness, and corporations unhesitatingly refer to themselves as “EOEs” (Equal Opportunity Employers) in their corporate literature.
Supplier diversity initiatives are natural extensions of your EOE status, offering economic growth opportunities to those whom you choose to do business with. By extending these opportunities, your corporation grows from an EOE to what we call an “EOP” (Equal Opportunity Purchaser). The ripple effect that comes from being an EOP is profound, and will positively impact generations of your future customers.
Help mold the type of businesses you want to work with
MBEs often embody the spirit of innovation, flexibility and exhibit a willingness to quickly adapt to their clients’ needs. MMSDC provides numerous to assist corporations in developing stronger business partners. Independent studies have shown that businesses with minority supplier development initiatives gain stronger relationships with their supply base, new business opportunities and a more agile supply chain.