How Supplier Diversity Can Help Build Sustainability
January 22, 2023 11:00:00 AM PST January 22, 2023 11:00:00 AM PSTnd, January 22, 2023 11:00:00 AM PST
There has been an increasing focus on both corporate social responsibility and sustainability as factors in improving brand trust and loyalty in the marketplace. Mostly, that is because more consumers than ever are taking a closer look at the companies with which they do business. In fact, studies show that 70% of consumers are interested in how businesses are working to tackle both social and environmental issues and almost half of them consider these efforts when making purchases from individual businesses.
Having a corporate goal of pursuing initiatives that help build sustainable practices and encourage socially responsible practices can help influence both the purchase intentions of your target audience as well as brand loyalty and trust. It can show prospective customers not only that your company has strong ethical values, but also that you put into practice what your corporate policies intend.
One easy way to achieve both sustainability and social responsibility with one initiative is through supplier diversification. Spreading your purchasing power among a group of diverse, and often underrepresented, suppliers can help foster a strong sustainability program and move you closer to success with your environment, social, and governance (ESG) goals.
Corporate Sustainability and Supplier Diversity
Every corporate sustainability initiative has three parts — think of them as “planet,” “people,” and “profits.” In simple terms, these refer to the environment, social initiatives, and the economy. The environmental aspect means reducing environmental impact through any number of ways including through reduced carbon emissions, energy usage, waste, and others. The social aspect means providing inclusion, equity, and diversity both in the workplace and among business partners and collaborators. Finally, the economic piece of the puzzle means reaching revenue goals while supporting the other two pillars — social and environmental — in order to create jobs and a sustainable workplace over time. Supplier diversity can support each of these goals in the following ways:
Diverse Suppliers for Environmental Sustainability
Working with smaller, local organizations can result in increased sustainability for your business in a number of ways. First, you can achieve reduced carbon emissions by decreasing the amount of miles goods must travel to be delivered to your door. Also, smaller suppliers often have innovative solutions to the issues of waste and energy consumption since they often have smaller profit margins that benefit from stricter oversight.
Furthermore, a diverse supply chain can help your company identify suppliers who focus on sustainable practices, including using Fair Trade supplies, production materials that are responsibly sourced, or create a work environment that focuses on waste reduction and employee health and well-being.
Diverse Suppliers for Social Sustainability
Economic equality is a hot topic that is a significant touchpoint for many consumers. Investing in a strong supplier diversity program allows your business to contribute significantly to bringing equity to the business marketplace. Additionally, working with diverse local suppliers also helps your company invest in your local community, improving economic conditions in the place where you do business. In this way, the recruitment of a diverse supplier base can directly support your social corporate sustainability goals. And, helping others in your local economic community fosters trust and can even help your company make connections that can open the doors to new revenue streams and additional markets.
Diverse Suppliers for Economic Sustainability
There is no denying that a diverse supply chain contributes greatly to cost savings, which, in turn, supports increased revenue and profitability. This is all good news for stakeholders and shareholders alike. In fact, one study showed that for each $1 million spent on supplier diversity, companies could add $3.6 million directly to their bottom lines. With that kind of return on investment, shareholders are bound to be supportive of supplier diversity efforts.
However, that isn’t the only economic value that supplier diversity brings to the table. As mentioned earlier, working with diverse suppliers means supporting resilience and health in local and global communities. A diverse supply chain benefits everyone in society by being able to weather substantial changes in economic standards, market shifts, and consumer demands. When a supply chain is healthy, it is able to support economic growth and societal needs — even in the face of disruption and downturns. A healthier supply chain means companies and consumers alike have access to the products and services they need — even in the event of major disruptions and disasters.
Increase Your Company’s Sustainability — and Revenues
Supplier diversity is not just a buzzword. It is a serious and strategic business initiative that assists businesses in being leaner, more agile, and more profitable. A necessary — and embraceable —byproduct of a strong supplier diversity program just happens to be greater corporate sustainability. From environmental to social and economic goals, supplier diversity allows businesses to touch on each one of these by building a strong, targeted supplier community that supports not only the business that you do, but also the world in which you live, work, and play.
As a local, state, and federally certified woman-owned business (WBE) and small, disadvantaged business (DBE), Quality Imaging Solutions is committed to providing the highest quality goods and services to our business partners and customers. Adding us to your team of suppliers can help you meet your ESG goals, keep your performance and productivity high, and save money to support better profitability.
If you want to learn more about how partnering with QIS can add value to your bottom line and support healthy indirect procurement, just contact us today!