In an increasingly competitive global marketplace, diverse suppliers need to find ways to stand out and showcase their unique value. One such method is through obtaining supplier diversity certifications. In this article, we’ll look into what these certifications are, how to get them, and why they are essential for securing contracts and bringing credibility to your business. We’ll also touch on some of the challenges associated with getting certified, and why, despite these challenges, these certifications are still worthwhile.
What Are Supplier Diversity Certifications?
Supplier diversity certifications are formal recognitions awarded to businesses that are majority-owned by individuals from diverse backgrounds, including minorities, women, LGBTQIA+ individuals, veterans, and disabled people. These certifications are usually awarded by recognized councils and organizations such as the National Minority Supplier Development Council (NMSDC), Women’s Business Enterprise National Council (WBENC), and others.
Why Are These Certifications Important?
Supplier diversity certifications provide several benefits to businesses:
Access to Opportunities
Large corporations and government agencies often establish supplier diversity goals, where they aim to procure a certain percentage of their goods and services from certified diverse suppliers. This policy is rooted in their commitment to promoting economic inclusion and facilitating diverse supply chains. Holding a supplier diversity certification, therefore, offers a clear competitive advantage. It opens doors to potential contracts that might otherwise be challenging to secure, and it positions your business more favorably in the procurement selection process.
Credibility
A diversity certification is more than a label; it’s a testament to the authenticity of your business. It signifies that your business is majority-owned, operated, and controlled by individuals from diverse backgrounds. This credential provides a seal of trust and enhances your business’s reputation, making it more attractive to potential partners. It assures these partners that by working with you, they are genuinely contributing to supplier diversity and inclusivity.
Networking
Being certified by organizations like the NMSDC or WBENC offers more than just the certification itself. It also allows you to be part of a network of diverse suppliers. These networks often offer unique opportunities to engage with potential customers, industry experts, and other diverse suppliers. You can share best practices, learn from others’ experiences, and form strategic partnerships. These networking opportunities can be invaluable for growing your business and expanding your industry knowledge.
Training and Development
Many certification bodies are committed to more than just verifying diverse ownership. They aim to foster the growth and development of diverse suppliers. To this end, they often offer a variety of resources, including training programs, workshops, mentorship programs, and access to industry research. These resources can help you improve your business operations, stay ahead of industry trends, and continuously improve your offerings. This, in turn, can make your business more competitive and better equipped to secure larger contracts.
How to Get Certified?
The process for obtaining a supplier diversity certification varies depending on the certifying body, but it usually involves these general steps:
Check Eligibility:
Before initiating the certification process, it’s vital to determine whether your business meets the specific requirements of the certifying body. For most diversity certifications, your company must be at least 51% owned, controlled, and managed by individuals who identify with a diverse group (ethnic minorities, women, LGBTQIA+, veterans, or disabled people). Different certifying organizations may have varying definitions and requirements, so it’s important to research thoroughly and choose a certification that aligns with your business identity.
Prepare Documentation:
The documentation stage requires careful preparation. Certifying bodies typically request proof of business registration, ownership documents, financial statements, operational documents, and proof of diverse ownership and control. These may include articles of incorporation, stock certificates, lease agreements, bank records, tax returns, and resumes of key personnel. Preparing these documents beforehand can expedite the process and help avoid potential delays.
Application:
Once you’ve gathered all necessary documentation, you’ll need to fill out an application form provided by the certifying body. This form usually asks for detailed information about your business, including its structure, ownership, financials, and operations. Take your time to fill out the application accurately and completely, and double-check all information before submitting.
Review and Verification:
After submitting the application, the certifying body will conduct a thorough review of your documents and the information provided. They might also conduct site visits or interviews to verify the facts and ensure the business is indeed majority-owned, controlled, and operated by individuals from a diverse background. This step can take several weeks to a few months, depending on the organization.
Certification:
If your application meets all the criteria, your business will be awarded the diversity certification. Most certifications are valid for one to three years and will require recertification after they expire. Remember, obtaining certification is a significant achievement, but it’s just the start. The true value of certification comes from leveraging it to gain access to new opportunities, enhance your business reputation, and grow your enterprise.
Challenges and Risks
Obtaining a diversity certification can be time-consuming and may involve a significant financial investment. The process requires careful preparation of documentation and potential site visits. Some businesses may find this process intimidating or overwhelming.
Despite these challenges, the benefits of getting certified are significant. Certifications can provide access to new opportunities, enhance your credibility, and strengthen your business’s standing in the market.
At Hire Ground, we’re committed to supporting diverse suppliers on their journey. We understand the challenges involved and provide resources and guidance to help you navigate the certification process, reinforcing our mission to foster an inclusive and equitable business landscape.
Supplier diversity certifications are not merely seals of approval; they are powerful tools that can propel your business to new heights. Although the certification journey may pose challenges, the benefits and opportunities it brings far outweigh the hurdles.
Key Takeaways:
- Supplier diversity certifications are formal recognitions given to businesses that are majority-owned by individuals from diverse backgrounds.
- These certifications offer access to business opportunities, lend credibility, enable networking, and provide training and development resources.
- The certification process involves checking eligibility, preparing documentation, application, review, verification, and certification.
- Despite the challenges and time investment involved in obtaining a certification, the benefits are well worth the effort.
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