Tips for Better Collaboration with Diverse-Owned Businesses

Corporates can help diverse-owned businesses succeed by avoiding practices that can contribute to their failure. The biggest challenges that occur for diverse owned businesses when working with global corporates are:

  • Challenge to beat experience/qualifications/ references in scoring factors for diverse business vs established suppliers
  • Payment Terms
  • Lengthy contracts & onboarding procedures
  • Geographical reach – geo coverage insufficient for multi region or global RFx’s
  • ISO or other required certificates missing
  • Insurance (liability) coverage
  • Social & environmental systems not sufficient
  • Balance Sheets
  • Size of the company for breadth & depth of work requested too small

Procurement officers therefore have an important role to play in helping diverse-owned businesses overcome these barriers to accessing contracts through appropriate risk assessment.

  • Do we need $ 3M liability coverage for every contract?
  • Do we need confirmation of a healthy balance sheet over 10 years?
  • Can we agree to a 14 or 30 day payment term?
  • Can we set up a short track onboarding for smaller business?
  • and many more

In this Future of Sourcing online magazine article ”Procurement Teams can Diversify Suppliers & Manage Risk”; https://futureofsourcing.com/how-procurement-teams-can-diversify-suppliers-and-manage-risk, written by Lara Hodgson, CEO and co-founder of Now – she’s providing five tips to help procurement teams meet DE&I supplier goals.

Next week; What to consider when working with corporates for diverse owned businesess.

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