The benefits of working with minority owned businesses range from speeding up innovation to increasing brand awareness and loyalty among customers with shared values. Finding a vendor mature enough to handle advanced needs can be challenging. As a diverse printing company, we sometimes see internal stakeholders get skeptical about switching to a new vendor and sustaining success. We came up with these tips to help companies increase supplier diversity spend along with competitive edge and company buy-in.
#1. Find Out Where Vendor Gaps Exist and Diversify With MBE Solutions
Many diverse vendors keep getting work simply because they are part of a departmental system. In other cases vendors become trusted allies after they come through in times of crisis. However, it’s evident that no company wants a policy to disrupt daily success of the business. An effective strategy to increase diversity spending in the supply chain must be grounded in the numbers, and the stories behind them.
That said, it may be both an easy and popular decision to find a minority owned business that meets a currently unanswered need, rather than replacing a trusted partner. In areas that are big-line budget items, like fulfillment, promotional products or print on demand services, talk with stakeholders about why they trust current vendors. Brainstorm what types of projects could be delegated more easily than others. Smaller quantity items such as printed flyers, brochures or letters can be easily offloaded. This can make increasing diversity spend more of an exciting strategy change. It also presents it less of a “pushy” requirement. Present supplier diversity benefits upfront if you are facing internal pushback from marketing or leadership. Allowing key stakeholders to be aware of all benefits of using a diverse business makes you look like the hero.
Checklist to proactively share new diverse vendor benefits:
- Host milestone meetings with key leadership to listen and understand internal department pain.
- Create a feedback loop to share how diverse businesses provide solutions as partners (beyond simply meeting MBE diversity spend).
- Share the percentage of supplier diversity spend each project meets. Include how this percentage can add winning points to government RFP bids.
- What ongoing projects can easily be put towards diversity spend (without onboarding multiple vendors)?
#2. Find Diverse Partners not Vendors
The value of a committed partner is keeping supply logistics and other project timelines on track. When talking with stakeholders about what is working and what isn’t, ask about these concerns, too. Diversifying spend is an opportunity to seek out minorities who want to support the operational and administrative needs of your project and team. This includes minority-owned partners uncovering existing opportunities to increase diversity spend through subcontract and their vendor relationships.
Clear project plan to kick-off diverse partners:
- Setup weekly check-in calls.
- Create co-owned agendas for partnership feedback loop.
- Build email template to share meeting outcomes and status updates.
- Take advantage of software tools to coordinate internal and partner communication.
- Partner with minorities that can cut internal steps needed to complete a project (not add to workload).
#3. Find Diverse Partners of the Right Size
Finding “right-sized” diverse partners is key to making changes in your diverse spending benefit your company. Small and agile enough to be hands-on partners, while still achieving the scope of work a large enterprise needs to thrive. When you can increase spend with minority businesses you trust can complete your projects, it’s a perfect situation. Strategic questions during the proposal process identify the amount of “heavy lifting” a minority business is able to make.
Questions to appropriately vet diverse partners to find a good fit:
- What percentage of the minority is servicing Supplier Diversity needs?
- Does the minority business service the work internally or subcontract?
- Determine how long has the company been in business and how much have they grown since conception?
#4. Find Minority Partners with Unique Skills
Likewise, highly regulated industries like finance and healthcare need partners with experience, too. HIPAA, HITRUST, and SOC2 are just some of the critical certifications in these industries. In some industries, vendors must be licensed by state. Other projects require strict reporting for compliance reasons. Minority owned business partners who know these details about your industry can help an overworked team feel less stress and improve processes. For security and compliance, partner with an diverse business that can clearly demonstrate unique skills.
Uncover unique skills of minority vendors, such as:
- Updates on legislations and federal requirements (like USPS secure mailing)
- Facility surveillance and single point of entry mailing center
- Employee certification documentation
#5. Find Minority Partners that can Scale with You
Many businesses find values partially motivate an increased supplier diversity spend. But there’s also the need to grow the business. For many companies bidding on a Federal or state-level contract, they are under certain requirements to spend dollars with minority businesses enterprises. If they win the contract or can even give them a competitive advantage over incumbents that don’t have enough minority spend commitment in the bid. For businesses with regional or national growth strategies, these kinds of contracts can be vital. This requires confidence in the partners involved. However, when an MBE is certified in your state or region, it’s one good sign they have the maturity to support a large-scale project. (Bonus points if they’re willing to get certified where possible!)
Due diligence can help to find out if a minority business can support overall business growth:
- Find out the states where they hold certifications and match up multiple location contracts.
- Ask the average number of bids the organization subcontracted for within the past year.
- Be sure to ask about the volume of work they can handle (i.e. current # of members served, # of mailing pieces processed per day or month.)
Overall, increasing supplier diversity spend is a decision every business makes for different reasons, and they all hope for similar outcomes. The benefit is to support the growth of new perspectives and harness innovation. Take time to prioritize your competitive advantage by looking for these characteristics in your dieverse partners.