What Is Supplier Diversity?

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Do you want your business to make a positive impact? You need to know what supplier diversity is and why it is important. Supplier diversity programs add value and help grow a more inclusive economy. Keep reading to learn more! 

How do you define supplier diversity?

A business that is at least 51% owned and operated by an individual or group that is part of a traditionally underrepresented group is considered a diverse supplier. The definition of diversity has changed over time as we understood it better. But, the most common types are small-business enterprises (SBEs), minority-owned enterprises (MBEs), and women-owned enterprises (WBEs). As a business owner, you can either be a diverse supplier, buy from diverse suppliers, or both.

Companies that are not diverse suppliers look to encourage the growth of these businesses by having more diverse spending. They ensure that a growing percentage of their vendors are diverse suppliers.

Win & Winnow is a Women-Owned Business that has always strived for equality and diversity. That is why we also carried out a Supplier Diversity Program. We want to incorporate our values into our business strategy. We believe that good business helps the company grow while it has a positive impact on people and the planet, we have the responsibility to make a difference and contribute to a better and fairer society.

What is the supplier diversity program’s history?

In 2022 supplier diversity sounds familiar—diversity, inclusion, the gender gap, and carbon neutrality are all topics that are here to stay. But not everyone knows that supplier diversity programs started more than 50 years ago. This type of program originated in the United States and is firmly rooted in the civil rights movement of the 1950s and 1960s when people called for justice and equality for Black Americans. Those protests ultimately paved the way for many groups to participate in the marketplace.

In 1953 Congress in the US passed the Small Business Act to “aid, counsel, assist, and protect the interests of small business concerns” and ensure that they received a fair portion of government contracts. This was the first step toward establishing a supplier diversity program that would evolve with legislation in the 1960s that created an Office of Minority Business Enterprise to end the discrimination that prioritized majority-owned companies. These policies continued growing and replicating in the rest of the world.

Supplier diversity in the rest of the world is a 21st-century movement. The UK was the first non-U.S. country to pass legislative action addressing business equality. France followed suit in 2006 with socially responsible public procurement best practices, and soon other European countries were joining the movement to ensure equality throughout the supply chain. 

What is the value of supplier diversity?

Positive impact

The first and most important outcome of supplier diversity is promoting a better and more equitable economy. Diverse businesses normally encounter more barriers; this challenges their startup, networking opportunities, access to capital, and sustainability. Programs that actively look to grow diverse spending help these underrepresented businesses overpass the barriers they meet in the market. 

But programs that look to benefit diverse suppliers also uplift the communities where these companies are located. Jobs are created, and wages and tax revenue increase, which has a tangible positive economic impact. 

Company culture

One of the main advantages of a supplier diversity program is the impact it has on company culture. It is a way of giving your employees a sense of purpose and maintaining ethical standards. Working in a business that apart from generating revenue wants to have a positive social impact in the world is a strong selling point when hiring. 

We tend to believe that all talent wants to hear about is company benefits and salary. But sharing the business values and programs can generate much more interest and commitment in employees than we think.

Commercial Advantages

There are two gains commercially, the first one is related to a bigger pool of potential suppliers that grants more supplier competition. The bigger pool of possible vendors promotes innovation and the entry of new products, services, and solutions. This combined with the necessary competition between regular and prospective suppliers leads to better, more advanced, and cheaper products. 

Nevertheless, it is true that in some fields finding minority-owned vendors might be challenging. This is an opportunity for companies to seek small suppliers that might need guidance in the certification process. Part of your supplier diversity program can be having mentoring programs to help them meet the standards required. This might be done in partnership with organizations that are already looking to boost and help diverse suppliers grow. 

The second commercial benefit is related to the brand image. In the same way a prospective employee might be more attracted to a company with a supplier diversity program, a client might also feel more inclined to a business with an ethical economic objective

In 2019, Hootology did a study for Coca-Cola and found that people who knew about their supplier diversity initiative were 49% more likely to consume their products. Almost three years later the interest in diversity has not decreased, in fact, it has increased, joined by a worry about sustainability in general. Programs that search for a positive impact on both people and nature have to be communicated because it is an amazing asset. 


Today, diversity programs are a mandate and some companies might create them without a strategy behind the initiative. These departments turn into isolated office that has no or little influence on decision-making and therefore are less likely to positively impact the company and the targeted people.

This issue seems to lead us to an obvious conclusion, diversity programs should be more central. But the actual answer is everybody in the company must understand why a diversity program is important and how it can benefit the business. 

If you want to know more about the benefits of committing, you can read here

Why Certification as a Diverse Supplier is Important?

Certification opens doors to opportunities because they provide corporate buyers assurance that a business has been confirmed as a diverse supplier. Once certified, a business owner can take advantage of many programs and benefits ― including mentoring, networking, strategic pathways, access to capital, and training ― often provided by the corporations themselves.

Corporations, however, do not offer a route to certification. There are several organizations that verify a business’s diverse status.

In Win & Winnow we are certified as a Women-Owned Business. Diversity, Equity and Inclusion, and sustainability are essential to reach full enjoyment of all human rights in our community. We recognize that they are also keys to achieving sustainable development. That is why we prioritize diverse businesses that use sustainable practices and materials that do not harm the planet.

If you are willing to learn more about us, please get in touch!

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What Is Supplier Diversity?

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