Diversity Spend in Pandemic Times
Supplier diversity will help businesses large and small recover from the COVID 19 pandemic, irrespective of the fact that many medical professionals say the world will never go back to “normal.” As this global catastrophe continues to disrupt business, and life, as we once knew it, the global supply chain is straining under the pressure to fulfill essential needs. Restrictions on importing from specific locales coupled with increased and new demand for certain commodities are exposing weaknesses in the supply chain, and as procurement teams search for alternative sources to fill temporary gaps, the time has come to consider new suppliers and partners in the marketplace.
Enter supply diversity spend, a strategic solution for reducing the impact of COVID 19 on the supply chain.
The Local Factor
In a time when global supply chains are being shaken up, it’s time think smaller – and more local. iQuantum diversity spend tracking analysts have seen a trend toward localization growing over the past few years, driven by consumer preference and technological advances, and what we’re seeing now (considering the disruption of the global supply chain) is how a shorter supply chain can be considered an advantage.
Here’s a good example of what we mean and what we have seen via our diversity spend tracking efforts: Sourcing from a local vendor eliminates the need for warehousing, thus cutting costs and expediting delivery. During a time when some commodities are scarce in large quantities, we are finding that local suppliers have access to multiple sources that may not be on everyone’s radar.
Another example, on a micro-level, can be seen with so-called big box stores; these outlets ran out of disinfectant wipes and bathroom tissue almost immediately, with infinite stretches of empty shelves being a common sight at supermarkets. Then, reports began coming in suggesting consumers were turning to locally-owned shops – bodegas, mom-and-pop groceries, farm and ranch supply stores – and discovering that these neighborhood establishments they may not have visited in years, if ever, carried those same supplies at reduced prices.
The Competitive Factor
Companies with supplier diversity programs and which use diversity spend software know that partnering with diverse suppliers offers multiple advantages that help them stay competitive in the marketplace. Here’s how diversity spend adds value to your bottom line:
- Promotes innovation via introduction of new products, services and solutions
- Provides multiple channels from which to procure goods and services
- Drives competition on price/service levels between a company’s existing and prospective vendors
If a company is experiencing supply chain disruption, or is anticipating a disruption following this global crisis, it is imperative to take a look at what diverse suppliers can offer. Solutions such as diversity spend software represent a smart move in an ever-changing world and marketplace.