13 May 2004 | Andrew Golder
Using women and minority businesses as suppliers can help a company to build its customer base and make its supply chain more adaptable.
Women and minority consumers are the fastest-growing consumer sectors in the US at present and women spend an estimated $81 of every $100, delegates at the Institute for Supply Management's annual conference in Philadelphia were told.
The minority population is also the fastest-growing segment of the community, and minority and women-owned business represent a growing percentage of the economy.
Betty Banks, chairperson of Minority and Women's Business Development Group, said: "Companies that embrace diversity and establish early success in this arena will have a competitive advantage in the future."
Parker Kapp, chief procurement officer for Amalgamated Beverage Industries, part of brewing giant SABmiller, said: "Reaching out to women and minorities through the supply chain is a quick and effective way to build a larger customer base and boost profits."
Kapp said that using diverse suppliers had obvious benefits, but warned that such companies had to be able to meet the buyer's needs and be performance-monitored like other contractors.
He said the advantages of using women and minority suppliers included helping to promote a company's values, supporting the community and helping a company to meet regulatory requirements.
Kapp added: "There are customers who are diverse and you want to include them as part of your customer base.
"Diversity in your supply chain helps to attract them towards your business and bring money into your company."
Linda Denny, chairman of the Women's Business Enterprise National Council, said: "The major benefits are that companies find excellent suppliers that provide products and services at a competitive price."
She added: "In many cases, because these suppliers are smaller companies they are far more likely to be able to react to changes in the economy or their customers' requirements.
"This makes the supply chain far more responsive to need and better placed to address sudden changes in demand, which in turn makes them more useful to the customer."