Does your company set — and accomplish — diversity spend goals?

Many states implement goal-based programs to encourage state agencies to work with diverse suppliers. Often, state-funded grants are awarded based on compliance with these spending goals.

For example, the state of Illinois established the Business Enterprise Program (BEP) to increase procurement from businesses owned by minorities, women, and individuals with disabilities. The program encourages stage agencies to allocate 20% of viable contracting work to qualifying vendors.

To qualify as a diverse supplier under the BEP, vendors must meet the following criteria:

  1. The business must be at least 51% owned and controlled by persons who are minority, women, or designated as disabled.
  2. The business’s owner must be a United States citizen or resident alien.
  3. The business’s annual gross sales are less than $75 million.

Outside of Illinois’ efforts to foster ethical business practices and competition, diversity spending is a major priority for many of the world’s largest corporations. Companies like Coca-Cola, Target, and UPS spend hundreds of millions —and even billions — on tier-one suppliers every year.

Coca-Cola’s diverse supplier spend was roughly $800 million in 2019, and the company set an even higher goal of $1 billion for 2020. Target worked with 536 diverse suppliers in 2018 on its way to spending over $1.4 billion on their goods and services. UPS spent $2.6 billion with small and diverse suppliers in 2018.

Why do these companies prioritize diversity spending? Because they recognize the long-term benefits. An inclusive supplier program promotes competition, which can lower costs and increase product quality. On top of that, it improves brand awareness and perception. According to a 2020 study by Hootology, consumers are three times more likely to buy a particular brand’s products or services if the brand is perceived as committed to diversity.

 

Looking for a qualifying vendor?

Sepire is BEP certified, so Illinois state agencies can work with us to meet their BEP spend goals. Sepire is also certified by the Women’s Business Enterprise National Council (WBENC) as a Women’s Business Enterprise (WBE), which allows our clients to claim tier-one diversity spend when they work with us.

 

Let’s talk about how Sepire can help your business.