Using Certification to
Grow Your Business

BY MARY CANTANDO

ost women business owners are aware that corporations have supplier diversity departments whose whole purpose is to identify minority and women vendors. These women know that corporations spend millions of dollars a year seeking nationally certified Women's Business Enterprises (WBEs) from which to purchase. However, most WBEs haven't been able to capitalize on this opportunity. Let's look at why these programs exist and how women can take advantage of them.

Why do corporations care about WBEs?
Let's begin at the base. Why do corporations go to such great lengths to identify WBE suppliers?

The reasons differ from corporation to corporation. However, conversations with diversity procurement officers and information from corporate Web sites point to three driving forces for suppler diversity:

1. Women are key customers. Many pharmaceutical, auto, and consumer product corporations fall into this category. These corporations know that women are the most significant purchasers of their products. In fact, in some instances, women purchase 90 percent of these firms' products.
   
   Using WBEs as vendors enables these organizations to better understand, provide for, and attract women customers. Involving WBEs in product development, packaging, marketing, and advertising gives these companies an inside track to their key buyers.
   
   An interesting example of this is Harley-Davidson, whose sales historically have been driven almost exclusively by men. Over the past several years, however, Harley has discovered that women are their fastest-growing market and that they must pay attention to women if they want to continue to earn their loyalty. One of the best ways to do this is to use WBEs as vendors.
2. They need WBEs to win contract awards. Many governmental and corporate organizations encourage, and often require, their suppliers to include WBEs as tier suppliers. For example, Bristol-Myers "strongly encourages existing suppliers to include WBEs in contracting and procurement activities." The Quaker division of PepsiCo calls for suppliers to "carry out Quaker's policy of Supplier Diversity through their awarding subcontracts to minority and women-owned companies."
   
   Many organizations carry this one step further and actually require diverse subcontractors for certain contracts. For example, Volvo Trucks seeks diversity vendors as a condition of its contract to provide vehicles to the U.S. Postal Service.
   
   Many organizations use WBEs as tier vendors to gain major corporate and government contracts and to fulfill the requirements of these contracts.
3. WBEs provide a competitive advantage. Corporations such as Progress Energy believe that WBE programs provide them with a competitive advantage and make good business sense. Progress Energy believes that WBE partnerships support continuous improvement of products and processes and further its corporate value-driven culture. Diversity procurement also is a key business strategy for the JC Penney Company, which believes supplier diversity "supports economic opportunities while enhancing (JC Penney's) competitive viability." This ties back to the fact that women are JC Penney's key customers.
4. It's more than just the right thing to do! Of course, these companies also want to work with WBEs because it's the right thing to do. They understand that a healthy company and society depend upon allowing all to participate in the national economic growth. But, their overall decision to use WBEs is driven by hard business reasons, and that's good news. These companies are looking at their bottom lines when they contract with WBEs - we are their key customers, we help win contract awards, and we provide them with a competitive advantage. It's that simple.

Then why is it still tough for WBEs to break into these corporations?
If corporate America has awakened to the significance of women as customers and vendors, why do so many women continue to struggle in marketing their goods and services? For every WBE success story, there seem to be a dozen women standing on the sidelines in frustration.

So, what's the secret to capitalizing on WBE status?

As part of a complete marketing and sales plan, certification can be an effective way to make contacts and create shortcuts in building business. But, certification is not an "if-you-build-it, they-will-come" solution. Like any worthwhile business endeavor, opportunities to capitalize on your certification hinge upon your ability to research, plan and execute.

Begin by selecting a few target companies on which to focus.

Do your homework and research how they move from identifying a customer need to delivering a final product or service to that customer. Know what they are celebrating; understand their challenges; and learn their jargon. Understand their current supply chain, and learn all you can about their organizational structure.

It's no secret that almost every corporation has drastically restructured in recent years. They've outsourced entire departments; they've collapsed levels of management; and they continue to look for ways in which to eliminate non-core segments.

Look for changes that may have left holes. In some instances, those holes have been plugged temporarily. But, is there a way in which you can offer a more permanent, more cost-effective solution? Rather than a standard focus of, "How can we gain business with this company?" you should always be thinking, "How can we contribute to the success of this company?"

To contribute to a firm's success, you must be able to articulate the value you add.

It is the purchasing officer's right to ask you "How are you different?" It is your responsibility to respond without using worn-out phrases, such as "customer service," "quality," or "lowest price." Those terms, and others like them, are not differentiators; they are the price of entry. Differentiators are items such as turnaround time, unique packaging, offshore production, or strategic alliances. Zingers like these will enable you to stand out from the competition and gain the business.

Once you've done your research and determined your approach, you must develop and execute a communication plan.

At this point, many women neglect the diversity procurement officers of the companies with which they are already doing business. It's particularly important to contact those individuals if they don't know you and may not be counting the "spend" that your company is doing with their company. You should introduce yourself to them and find out how the business you are currently doing with their company can be added in to help them meet their diversity procurement goals.

So there you go. Research, plan and execute.

There is no magic wand, just hard work. But, if you want to play the game rather than watch from the sidelines, this is the way to get in there.

MARY CANTANDO is president of Cantando & Associates (www.WomanBusinessOwner.com), a Raleigh, NC-based publishing and consulting firm that focuses exclusively on women business owners. She can be contacted at 919-841-0401 (e-mail: Mary@WomanBusinessOwner.com).