Accepting standards for reporting supplier diversity spending will bring greater transparency and better benchmarks. Supplier diversity spending is notoriously difficult to compare between companies. Every company has their own definition of what is included in “diverse spending”. Here are just a few examples of the variations we have seen: What is a diverse supplier? There isn’t a common standard for the types of suppliers that are considered diverse – some include only MBEs and WBEs, while others include additional categories such as Veteran-owned and LGBT-owned businesses. Some also include small businesses in this definition. Do they have to be certified? Some corporations only accept businesses that have been certified through an agency, […]
Category Archives: Supplier Diversity
Should you add a small business criteria to your supplier diversity program?
Adding a Small business allocation to your spending with diverse businesses can make a greater impact to diverse communities. Small businesses are important to the economy for their ability to create jobs. Many supplier diversity programs either do not track small business spending, or marginalize small business results in comparison to other categories. With Small Business Saturday less than a week away (November 26th), we want to highlight the benefits of smaller firms and explain why your supplier diversity program should be tracking small diverse businesses . When it comes to supplier diversity, an emphasis is placed on minority, women, veteran, disabled, and LGBT businesses. Although each category has a history […]
Small suppliers struggling with low cash reserves
Providing better payment terms to small businesses may reduce your supplier chain risk. Paying suppliers slowly as a way to conserve cash is a common practice among corporations of all sizes. However, it may be hurting your smaller suppliers and increasing your supply chain risk. Many small businesses do not have sufficient cash on hand to withstand a major impact. According to a recent Bloomberg article, most firms are operating month to month with cash reserves only lasting an average of 27 days. One of the contributing forces behind the lack of cash reserves is the extended payment terms frequently required by corporations. Long payment terms can increase supply chain risk in the event of […]