For minority-owned businesses, there is no better time than the present. According to the National Minority Supplier Diversity Council (NMSDC), which certifies Minority Business Enterprises (MBEs) in the U.S., MBEs (defined as businesses with at least 51 percent ownership by Asian-Indian, Asian-Pacific, Black, Hispanic or Native American U.S. citizens) employ 2.25 million people directly and indirectly, and have a total economic impact of $400 billion.
In addition, there are 11.6 million women-owned businesses nationwide, employing nearly 9 million people and generating more than $1.7 trillion in revenue, according to the seventh annual State of Women-Owned Business Report. And 2.52 million businesses nationwide are majority-owned by veterans, with total annual revenues of $1.14 trillion, according to the Small Business Administration (SBA).
As the number of minority, women and veteran-owned businesses skyrockets, companies of all sizes – including Fortune 500 firms, privately-held enterprises, not-for-profits and public/government agencies – are actively seeking ways to include MBEs in their procurement processes. It’s an approach called supplier diversity, and it’s providing MBEs with tremendous opportunity and promise.
Formal supplier diversity programs help businesses of all sizes obtain new products, services and solutions, create strong partnerships, promote innovation, provide economic opportunities to small businesses, drive affordability, and help to strengthen and advance a community’s economic base.
Supplier Diversity in Central Florida Schools
Companies and organizations throughout Central Florida have begun to embrace supplier diversity. One such sector where it’s happening is in K-12 education.
The Volusia County Public Schools (VCPS), for example, maintains a database of approximately 1,500 active vendors. While that database doesn’t capture socio-economic-specific information, VCPS vows to be transparent, fair and equitable to all who conduct business with the district. The district’s procurement website includes opportunities for businesses to register as a supplier.
Orange County Public Schools (OCPS), meanwhile, takes a visible and vigorous approach to supplier diversity. Within their procurement services department, OCPS features an Office of Business Opportunity, with staff dedicated to maintaining and enhancing supplier diversity.
OCPS is the fourth-largest school district in Florida (and the ninth largest in the nation), with more than 207,000 students at 180 schools. Its supplier database includes nearly 1,850 registered women, minority and veteran-owned businesses. In fiscal year 2017, the district’s total spend (both in direct purchase orders with MBEs and subcontracting with diverse suppliers) was approximately $155 million. The district’s commitment to supplier diversity has earned it numerous awards, including the 2017 Local Corporation of the Year honor from the Florida State Minority Supplier Development Council (FSMSDC).
“Our students and families are very diverse, and we believe it’s good business practice to do business with companies that represent our customer base,” said Joycelyn Henson, senior administrator in OCPS’ Office of Business Opportunity. “Also, spending money with small local businesses drives business back into the homes of the children and families in the areas we serve.”
Like many districts, OCPS has a myriad of procurement needs. They partner with vendors on everything from day-to-day supplies (pencils, paper, toiletries) to professional services (legal, insurance) to large-scale construction projects (engineers, architects).
To infuse diversity into its procurement process, Henson takes a two-pronged approach. “Internally, we educate our teachers and school personnel about our supplier diversity program,” Henson said. “We encourage them to recommend any minority owned businesses that may want to participate in our procurement process.”
She added, “In the community, I meet one-on-one with diverse business owners to determine specifically where the business ownership markets their products and services – who’s the buyer, where do we buy it, will we be procuring it again.” Henson also serves as an active participant in OCPS’s vendor selection process.
Making a Commitment to Mentorship
To educate and mentor small and minority-owned businesses, OCPS hosts “How to Do Business” sessions on the last Friday of every month. These networking events allow local business people to meet with OCPS leadership, meet some of the district’s buyers, ask questions about the procurement process, and teach them how to compete and market themselves to the district. “We’ve been hosting these sessions for two years, and we average 10-to-12 participants each month,” Henson said.
For OCPS, one of the greatest benefits of maintaining a robust supplier diversity program is community involvement. “When we form relationships with other organizations that support small businesses, such as the chamber, FSMDSC, WBENC (Women’s Business Enterprise National Council), it opens up dialogue,” Henson said. “They are seeking business opportunities. And we’re encouraging them to become partners in education. So, the company makes a commitment to the school, the school makes a commitment to the company, and we work together to support public education.”
Henson points to two local minority-owned vendors who have become both business and educational partners. One, a printing company, has evolved from providing small printing needs for the district to providing large signs and banners for OCPS football games and other athletic events. “Other parents got to know him through the school’s programs, and they became his customers,” Henson said.
Another is a construction business that partnered with OCPS in its infancy. It has since grown to become one of the Orlando area’s 50 fastest growing companies, as ranked by the Orlando Business Journal, and won a 2017 FSMSDC MBE Supplier of the Year award.
How to Compete for Business
While it may seem daunting, becoming a supplier for any corporation is within reach for many MBEs. Some tips to get started:
Get certified – Entities such as the NMSDC and WBENC certify minority and women-owned businesses. Such certification will send a message to buyers that your business is ready to compete. It also will allow your business to enjoy member benefits from such groups, including numerous professional development, mentoring and networking opportunities.
Learn the process – When it comes to procurement, every company has its own method of doing business. Learn them. Many companies with formal supplier diversity programs – and some without – will list their procurement processes on their website. Most will ask a business to register (For example, both VCS and OCPS use an online tool – VendorLink – that allows visitors to register and alerts them to potential opportunities.).Get involved – Companies enjoy connecting with businesses of all types, because having more potential vendors gives procurement departments the opportunity to drive efficiency. Attend networking events. Get to know the organization or company you wish to do business with. Ask questions. Most companies will be happy to help.