7 October 2010 | Rima Evans
Increasing the diversity of your supply base can benefit your business and make commercial sense, buyers were told at the Minority Supplier Development UK 2010 conference.
Deciding whether to work with an SME – instead of a large organisation – or an ethnically diverse supplier is not just about taking the diversity agenda forward, delegates heard, but about being competitive.
Aaron Dent, vice-president of indirect procurement at pharmaceutical firm Merck, Sharp and Dohme, said that at his company, suppliers, whether they be ethnic minority-owned, women-owned or an SME, are evaluated using a balanced approach.
“We look at supply assurance, delivery, cost, innovation, but also whether they are a diverse supplier. We have clear targets and goals and objectives around diverse suppliers.”
He added: “If everything was equal but one supplier had ticked the box indicating they were diverse then by default they would get the work.”
Pam Farmer, supplier diversity manager at BT, agreed that the business case for supplier diversity – achieving competitiveness in price and quality was key.
More than 60 per cent of BT’s suppliers are SMEs and 9 per cent minority businesses, she said. The company has a £20 million spend with minority enterprises and £135 million with SMEs.
One of the biggest advantages for BT in having a diverse supply base is being able to respond to customer requirements, she said.
However Farmer said: “Price is always important, how can it not be? But the argument we put to buyers is if you look wider than just those businesses you usually deal with it might drive costs down.
“We think SMEs and ethnic minority businesses can compete on a level paying field as regards to price.”
The conference took place in London this week.