The Definitive Business Case for Supply Chain Diversity — Part 1

Over the past few years I have searched for a study that objectively covers the current standing of minority owned businesses (aka minority business enterprises or MBEs for short) in America. While organizations like the Small Business Administration, Minority Business Development Agency, and others have taken a look at how these companies operate, I have never seen an all encompassing review of how MBEs function and how they benefit our nation.

To sedate my appetite for knowledge, I decided to spend the past nine months delving into research articles and studies to create that which I desire, a full research paper covering MBEs in America. While I do not expect this study to be an end all be all for MBE data, I do hope that this will be the first of many studies that highlight the potential of underserved communities and how we can strengthen them, to ensure the future economic prosperity of our nation.

According to the 2015 US Census Bureau, racial minorities will become the majority population in the United States by the year 2044. This means that, over the next two decades, America will experience major growth and development among businesses led by minorities. Despite the current trend of a growingly multicultural nation, support for the future American entrepreneur has not matched demographic estimates.

When assessing small businesses by race, according to the Small Business Administration, Non-Hispanic Whites encompass 70.9% of business ownership, but their companies account for 88% of all sales among small businesses; Black / African Americans make up 9.5% of ownership but only 1.3% of sales; Hispanics make up 12.2% of ownership but only 4% of sales; Asians make up 7.1% of ownership but only 5.8% of sales.

Small businesses account for anywhere between 45 to 50% of nonfarming GDP. If the current sales trend persists, aligned with the growth of minorities in population and business ownership, the contribution from small businesses to American GDP will significantly decrease over the next 25 years.

The US has historically struggled with the distribution of resources among its populace and, with a growing community of underserved individuals, we are now seeing increasingly worrisome statistics, such as an increase in the wealth gap between citizens. Understanding America’s future economy is necessary to ensure that our nation continues to be a global leader.

If you or someone you know is interested in the information presented, and want to learn more, I recommend that you visit the page below and take a look at the completed study.

https://diversityreporting.com/mbe-study/

My MBE Study includes a seven page summary along with a full 40+ page document. The study is free and includes data from the Small Business Administration, Minority Business Development Agency, Federal Reserve, US Census Bureau, Bureau of Labor Statistics, Brookings Institution, Pew Research Center, National Minority Supplier Development Council, and more. I welcome everyone to come check it out and give your thoughts on the information presented.

If you have any questions, please shoot me an email at jaymie.white@diversityreporting.com

ABOUT ME

My name is Jaymie White, and I’m an African American (or black, whichever you prefer) male, founder and co-owner of Diversity Reporting Solutions, a technology and consulting firm catering to the supplier diversity industry. I’ve been running my company for almost a decade and hope to continue in the space utilizing data to help educate people on the benefits of a diversified corporate supply chain. I am also the founder and editor of Supplierty News, a leading news outlet covering small business and supplier diversity information.

Check out my current project at https://diversityreporting.com/progress2020/

WHAT IS SUPPLIER DIVERSITY?

Supplier diversity is a proactive business program which encourages the use of minority-owned, women owned, veteran owned, LGBT-owned, service disabled veteran owned, historically underutilized business, and Small Business Administration (SBA)-defined small business concerns as suppliers. (thanks wikipedia). Supplier diversity programs assist corporations interested in expanding opportunities to communities that are often overlooked in the supply chain process. There are no mandates or set asides. Just corporations looking for new companies to add to their list of potential qualified suppliers.