In simple terms, supplier diversity is a business strategy employed by corporations to ensure that their supply chain is inclusive and that they are purchasing a targeted portion of goods and services from suppliers with diverse backgrounds.
97% of Fortune 500 companies have supplier diversity programs.
In the context of supplier diversity, a diverse supplier is a company that is owned (at least 51%) by a female, visible minority or indigenous person, LGBTQ+ person, person with a disability, or veteran. In Canada, organizations that certify diverse suppliers include:
- The Canadian Aboriginal and Minority Supplier Council (CAMSC)
- The Canadian Gay and Lesbian Chamber of Commerce (CGLCC)
- Women’s Business Enterprises (WBE) Canada
If your company meets the requirements, becoming certified can help you access opportunities to enter the supply chain of major corporations, both in Canada and abroad.
You can leverage the benefits of supplier diversity even if your company is not large enough to become a Tier I supplier.
To meet their diverse-spend targets, Fortune 500s measure both their own direct spend and those of their main (Tier I) suppliers, who are usually large companies themselves. This is where the opportunities for smaller businesses come from. While you may not have the capacity to match the volume of demand from a Fortune 500 you may be able to jump into the supply chain at a lower level and work with a Tier 1 or even Tier 2 supplier.
My company became WBE-certified two years ago. Since then my annual revenues have risen more than 25%. I have added two national-level clients to my roster and I have gained an incredible amount of knowledge about how large corporations think and how to pitch ideas to them.
I have also met hundreds of other business owners from diverse backgrounds. Through networking and building these connections, I have found answers to many business challenges, been introduced to several entrepreneurs that now provide goods and services to my company, and formed a collaborative partnership with a diverse supplier whose services compliment my own.
Unless your company is truly “local” and has no plans or ambitions to expand outside of your geographic location, I believe that you should seriously consider diversity-certification. There are many potential benefits and little downside. You do have to re-certify each year but the process is not onerous and the fee is reasonable.
The greatest thing I have gained from being WBE-certified is that it helped me think BIG.
I now have a clear vision of what my company is capable of providing to larger clients. I know how to communicate with corporate leaders using the language and tone they expect. I am confident of my company’s strengths and more adept at ‘selling’ those strengths to perspective clients, in a national arena. I no longer think small. I think BIG.
Article written by Kim Scaravelli, CEO of Trust Communications, an Instructional Design firm in Halifax, Nova Scotia. And yes… we are WBE Certified!