Supplier diversity programs are used to actively pursue vendors that are majority-owned by women, minorities, veterans, LGBTQ+ individuals, and people with disabilities. The goal is to create a more inclusive procurement process and promote economic opportunities for diverse suppliers. It also fosters innovation by leveraging the unique perspectives and capabilities of these types of suppliers.
The Women’s Business Enterprise National Council (WBENC) certifies companies that are majority-owned, controlled and/or operated by women. It is recognized as the gold standard for women-owned businesses, helping them gain access to companies and government contracts that prioritize supplier diversity.
One natural way for companies to expand their supplier diversity program is in the area of logistics services. It helps them mitigate risk in their supply chain by moving away from an over-reliance on single sourcing, which also drives down costs through more competitive bidding.
The Business Case for Supplier Diversity
Companies adopt supplier diversity programs for a number of reasons. It helps them enhance innovation and find creative solutions by tapping into new perspectives offered by business partners with diversity as a core value.
It also fosters a more inclusive supply chain by engaging with underrepresented businesses. This strengthens community relations and helps meet corporate social responsibility (CSR) goals by fostering fairness in business practices.
Supplier diversity also helps promote entrepreneurship among diverse communities, helping them grow and compete. Companies can enhance their brand reputation among values-conscious customers, create a positive social impact, and drive economic empowerment.
Tax Incentives Tied to Supplier Diversity
Tax incentives play a significant role in motivating companies to engage in supplier diversity programs, offering both federal and state benefits. This includes tax breaks, tax credits, and eligibility for government contracts.
These financial incentives help boost the bottom line, driving short-term cost savings while contributing to long-term profitability. It also helps expand procurement channels, providing access to new, innovative suppliers offering competitive pricing and flexible solutions. This helps promote greater supply chain resiliency and efficiency.
Strategically, aligning supplier diversity with revenue and economic impact goals can not only improve financial performance but also demonstrate a commitment to social responsibility. This, in turn, enhances brand reputation and fosters customer loyalty, contributing to sustained growth.
How Supplier Diversity Contributes to Long-Term Cost Savings
A practice of supplier diversity can drive both innovation and flexibility while improving service offerings. A WBENC-certified logistics provider, for example, is highly adaptable and focused on providing efficient, customized solutions.
Working with WBENC-certified logistics providers can help companies seeking to do business with minority companies, particularly in industries where supplier diversity is mandated. This is because government RFPs typically track what percentage of a company’s budget for suppliers goes toward certified minority-owned businesses. Also, a WBENC-certified provider brings fresh perspectives and innovative approaches to complex logistics challenges.
By diversifying their supplier portfolio, companies also reduce the risk of over-reliance on a single logistics provider. This creates a more resilient, cost-effective supply chain strategy that will pay off in the long run.
Advantages of Working with WBENC-Certified Logistics Companies
A diverse logistics provider, such as a WBENC-certified company, can offer new ideas that bring numerous advantages. For instance, a fresh perspective can lead to improved efficiency, customer service, and overall satisfaction, helping companies stay competitive and innovative.
Partnering with suppliers from underserved communities contributes to job creation, better wages, and local economic growth. This helps strengthen the overall economy and promotes more equitable business opportunities.
Long-term collaboration with diverse suppliers fosters mutual understanding and improved communication, leading to greater supply chain efficiency and reliability. It also helps companies better understand their strengths and weaknesses, making them more adaptable to rapidly changing market conditions.
Engaging with a broad range of suppliers helps drive down costs and improve profitability through broader procurement options and a more competitive bidding environment. It also helps promote business continuity and reduces risk, as single sourcing can backfire in the event of a capacity crunch.
The small-to-medium-sized nature of most diversity-focused suppliers means a greater emphasis on quality, collaboration, responsiveness, and a hands-on approach. This helps drive higher performance standards and better outcomes for their clients.
Diversifying Your Logistics Sourcing: Doing Well By Doing Good
Working with a more diverse supplier base offers both financial and social benefits. In addition to fostering innovation and flexibility, it also strengthens supply chain resilience by reducing risk while driving down costs through more competitive sourcing.
Beyond the financial impact, supplier diversity promotes economic empowerment and creates a more inclusive, socially responsible business environment. Companies can enhance their brand and foster customer loyalty, leading to meaningful economic growth.
Wicker Park Logistics, a premier 3PL transportation and logistics service partner, has been certified as a Women's Business Enterprise (WBE) by the WBENC. This marked a significant milestone in the company’s journey toward fostering a more inclusive, innovative business environment.
Wicker Park’s dedicated team of experts has decades of experience in logistics, supply chain management consulting, and transportation. Tapping our large network of specialist carriers across industries, we provide shippers with tailored solutions that deliver reliability and service excellence. Whatever your particular needs in any phase of trucking, LTL, intermodal and supply chain services, Wicker Park can help you optimize your transportation spend and provide the necessary agility and scalability that is required to execute business in this volatile market. Contact us today for a quick quote.
