Building Supplier Diversity
We are 100 percent committed to giving our customers unbeatable value, reliable quality and friendly service. Working closely with our suppliers to drive out unnecessary costs allows us to pass the savings on to our shoppers.
We encourage supplier diversity from our business partners in hopes of enhancing and integrating our supplier diversity programs into all of our procurement practices. Since 1994, Wal-Mart has had a formal supplier diversity program designed to expand its base of minority- and women-owned suppliers and does business with more than 3,400 Minority- and Women-owned Business Enterprises (MWBE).
We realize it takes a lot of time and effort to become a Wal-Mart or Sam’s Club supplier; therefore, we may not be the proper fit for every business. We are identifying ways that meet the needs of MWBEs who are looking to do business with Wal-Mart and Sam’s Club.
One way is the Local Purchase program. This program gives small businesses, who do not have the capacity to distribute products on a national level, the opportunity to sell their products at local or regional stores/clubs in their area.
To initiate the partnership process, business owners contact the store manager or food merchandiser at any Wal-Mart or Sam’s Club about the Local Purchases program. Before merchandise can be presented for resale, it must first be approved at the store level and then authorized by a buyer at the Wal-Mart Home Office.
Strengthening Diverse Supplier Partnership
We are working with our largest suppliers to structure a proactive outsourcing initiative that will identify new and grow existing minority- and women-owned businesses. In 2005, Wal-Mart began collecting data for its Second Tier program.
The program uses a reporting system to monitor how much the Company’s prime suppliers spend with minority – and women – owned businesses, as a result of their relationship with Wal-Mart. In 2006, the Second Tier program spending total was more than $925 million.
The Road Ahead
Lee Scott said it best – “to become a leader in diversity, we will increase the amount of business we do with minority companies, using our size and leverage to create companies of significant size and stature.”
As our customer base becomes more diverse, so does our need for diverse business partnerships. To achieve our supplied diversity goal we have an affiliation with the NMSDC (National Minority Supplier Development Council, Inc.), a widely recognized minority supplier accreditation organization. We also have a strategic partnership with the Women’s Business Enterprise National Council, Inc., the most widely used women’s business accreditation organization.
The supplier diversity program has grown from $2 million in 1994 to more than $4.2 billion spent during calendar year 2006. We will continue to explore opportunities to increase our spending with MWBEs and we look forward to building strong, sustainable partnerships with these suppliers.