A Case for Supplier Diversity

Add comment September 7th, 2007 David Bush - Iasta

Last month Purchasing ran an article on how supplier diversity can yield growth which stated that in 2006 AT&T documented that supplier diversity was a factor in generating 11 billion in revenue. 11 billion!

According to the article, diverse suppliers can act as powerful advocates for the company sourcing from them, especially since some diverse suppliers are politically active in their communities. “They’re more willing to step forward and say good things about us as a corporate citizen and support us in our efforts to offer product and services throughout the country.” noted Joan Kerr, the executive director of supplier diversity.

Furthermore, the article also notes that a recent study by the Women’s Business Enterprise National Council (WBENC) and management consulting firm SB Services reveals that 80% of female consumers polled who were between the ages of 35 and 55 would be “compelled to try a company’s product or service” if the parent company sourced from a woman-owned business.

For many years, many top-tier companies have been rolling out their supplier diversity programs at every part of their buying process and have been quietly reaping the financial benefits. Besides AT&T, Motorola is also reaping the benefits.

And if the potential financial upside is not enough, there’s always globalization. There are solid arguments that your supply base should reflect your consumer base, because consumers tend to buy from people they feel comfortable with.

Entry Filed under: General, Suppliers