Integrate social values into purchasing

Every business, nonprofit, and level of government purchases goods and services every day. This includes cleaning, catering, couriers, office supplies, IT, coffee, printing, maintenance and repairs, furniture, fuel, landscaping, and on and on. And within each of these purchases there are many choices from a broad variety of potential suppliers. Which criteria lead to the selection of the suppliers varies. Traditionally, purchasing decisions are based on lowest price for equivalent product or service. And recently, a stronger emphasis on avoiding negative environmental impacts has been added to many purchasing decisions.

What is not always considered in the choosing of a supplier, beyond the price point and negative impact screening, is what could be the ripple and multiplying result of that decision? Purchasing is not an isolated, cost-only decision. Intentionally or not, purchasing choices directly impact employment growth or decline, local and global economies, the environment, and every supplier and their community. The choice ripples along the supply chain, and not selecting a supplier has an impact on their business, and their suppliers. Do we need to look any further than the current USA "Buy Local" decision and its impact and reaction from Canadian and Mexican manufacturers and national governments to understand the connection?

When a purchaser makes purposeful purchasing decisions that blend economic, social and environmental impacts, they can directly and in a measurable and positive way influence the health and sustainability of communities.

However, moving to the use of purposeful purchasing in a business or organization requires the intentional creation of a supportive internal environment and the implementation of a strategy to achieve a blended value return on purchasing. As evidenced by movements such as Fair Trade and organic products, as more purchasers move to sustainable criteria, suppliers will move to meet their demands and requirements in order to get their business. Sustainable demand and supply relationships can create a powerfully beneficial supply chain.

Five steps for purchasing from social enterprises:

1. Build a purchasing framework the uses a “blended” purchasing criteria: price, quality, and social impact.
2. Work with your current suppliers to increase their engagement and partnerships with social enterprises.
3. Unbundle large contracts to make them accessible to social enterprises.
4. Create incentives, rewards, and measurements for social purchasing accomplishments.
5. Remember, it’s a cultural and behavioural shift that may take incremental steps toward a long term change.

 

[1] Living wage or prevailing wage may actually mean maintaining poverty; a development-based wage means sufficient income to support a family exiting poverty and enhancing future generation opportunities.

via seechangemagazine.ca

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