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6 Challenges Diversity Buyers Face When Looking for Global Services
Over the past decades, diversity buying has become an important strategy for many Fortune 500 companies. In 2006, a survey of Fortune 500 companies found that they spent over $100 billion annually with minority-owned suppliers. Additionally, another survey found that well over half of all Fortune 500 companies believed diversity buying was a mid-level or high-level priority for the organization.
Diversity buying offers forward-thinking Fortune 500 companies and businesses of all sizes across the world a variety of benefits. Small, minority-owned businesses are often more nimble and adaptable than larger suppliers. They’ll be able to give your business personal, dedicated support. And even though they operate on a smaller scale, they often receive generous tax advantages and might even be able to offer a cost advantage.
Of course, diversity buying does come with its own unique set of challenges, especially when you’re looking for assistance all around the world. Here are six of the most common challenges diversity buyers face when looking for global services:
The number of minority-owned businesses is growly rapidly, but the size of them isn’t. On average, a female or minority-owned business is smaller than a non-minority owned business. This is due to a variety of reasons, but the result is that many of these minority and women-owned businesses simply don’t have the capacity necessary to adequately supply a Fortune 500 company.
Depending on the scope and breadth of your business needs, a single order could put a minority-owned business at capacity, severely disrupting their operations. This could result in putting you both in a no-win situation. To avoid these possibilities, it’s important to always discuss the scope of your potential orders and the supplier’s current capacity. If it isn’t a good fit, you can look to start off with a smaller project, or try to move on and find a supplier that can better serve your needs.
When you’re managing a global organization, one failure in your supply chain can cause a massive problem. Keeping in mind that many women and minority-owned businesses are small, and that a whopping 80% of all small businesses fail in the first year-and-a-half, it’s easy to understand why diversity buyers often have a problem with business continuity.
Make sure to ask the same types of questions to women and minority-owned businesses that you would any other supplier. Look for businesses who have been around for a long time and serviced organizations for many years, such as Crews Control. If you can find a diverse business with a strong history, you’ll be able to solve many of your diversity buying problems immediately.
3. Locating Them
One reason many companies hesitate to implement an official diversity buying program is that they’re simply not sure how to find companies that qualify as minority-owned. The good news is that there are plenty of professional resources to assist you. The National Minority Supplier Diversity Council and even the U.S. Small Business Administration will be able to provide you a list of properly certified minority-owned businesses. You can also make an effort to specifically seek out these vendors when attending industry conventions.
Operating on a global scale means you need a network of flexible suppliers that can assist you in many different locations at the drop of a hat. With many smaller minority and women-owned businesses, this simply isn’t possible, especially when you’re already pushing their capacity. You need to find diverse businesses such as Crews Control that already have a global footprint and can help you anywhere in the world without skipping a beat.
As a global Fortune 500 company, you need to ensure that your goods and services remain consistent no matter where in the world you’re operating. In order to make that happen, it’s important to demand the same from your suppliers. According to the Harvard Business Review, this is a huge problem for even the world’s largest companies, such as McDonald’s.
If you’re dealing with a variety of smaller minority and women-owned businesses across the world instead of a handful of large suppliers, it’s going to be extremely challenging to maintain consistency. To compensate, you need to carefully vet your suppliers and impose demanding standards on them. If they cannot meet them, you’ll need to find another supplier instead of putting your own standards in jeopardy.
Another downside of dealing with a wide variety suppliers instead of one or two large ones is that procurement becomes extremely complex. Smaller businesses might not have the technical capability to tap directly into your existing supply chain management systems, making automation impossible. This forces you to learn different order processes for each supplier, making the whole process needlessly complex.
A good resolution is working to develop a standardized system for all vendors agnostic of their technological capabilities. If somebody cannot or will not adapt, you need to be willing to cut ties and move onto another vendor who offers a bit more flexibility in the ordering process.
As a women-owned organization, Crews Controls offers diversity buyers struggling with the above challenges an easy way to find and source corporate video crews around the world. You’ll enjoy the benefits of diversity buying while having access to an enormous pool of highly qualified video crews tailored to your specific needs. We’ll act as a single source for all your video production services needs while offering global support.
To get started with Crews Control today, all you need to do is click here for a free quote.