How Amazon Business is Helping Drive Supplier Diversity
Amazon Business (AB) is growing in popularity as a procurement platform of choice for small to medium-sized enterprises (SMEs) – but is now also helping businesses in another important area: supplier diversity.
The traditional view of AB is that it allows for the bulk purchasing of everything from lawnmower parts to office essentials.
But this being Amazon, AB is also able to offer a wealth of rich data, which is vital for providing actionable insights.
This means its customers can understand buying behaviours using advanced analytics and dashboards. They can see who’s buying what, and for how much.
And it is this aspect of the service that is helping service customers’ desire to build diversity into their supply chains.
On its website, AB shares a supplier diversity case study, which shows how Johns Hopkins University uses AB not only to buy the supplies it needs every day, but also to help it support the local economy by purchasing directly from local businesses.
Using AB, John Hopkins is able to identify credible suppliers, “including minority- and women-owned businesses that have the products they need”, says AB.
Based in Baltimore, Maryland, Johns Hopkins University was founded in 1876 as the first research university in the US. It is known for academic rigour, scientific advancements, award-winning alumni and faculty and receiving major federal research grants.
Procurement is an essential part of being a leading scientific research university.
“We cannot enable science without a robust procurement supply chain,” Brian Smith, Chief Procurement Officer at Johns Hopkins University says. “The goal of our department is to support the university’s mission to teach students, empower research and discovery and improve medicine.”
To better fulfil its mission of research, education and patient care, the university needed to step-up its capability to purchase products such as lab supplies, office products, maintenance repair items and IT peripherals.
Amazon Business data helping local sourcing
The University was drawn to AB for the centralised management and fast delivery of business-specific products. But it has also helped it with another strategic goal: supporting Baltimore-area small businesses.
In 2015 the university launched an initiative called HopkinsLocal to promote economic growth and employment in Baltimore.
“When small, local businesses sell on Amazon Business, they are suddenly on an equal playing field with the large businesses, and they have access to obtaining our business,” says Smith.
The revenue the University has been able to channel into small local businesses is significant. It spends around $1bn annually on sourcing goods.
“By purchasing locally on Amazon Business we have created significant opportunities for small and local businesses here in the city,” says Crystal Burns, Small Business & Supplier Diversity Lead at Johns Hopkins University.
According to Burns, a local lab supplier in Baltimore has been able to hire four additional people due to the increased purchases on Amazon Business from the university.
“We have such large spending power, it’s our responsibility to make sure that we are supporting our community,” says Burns. Through Amazon Business, the university is now using thousands of new small businesses to supply the institution.”
As part of HopkinsLocal, the university committed to increasing contracts with minority- and women-owned businesses. By using Amazon Business, the procurement staff can filter their search results by seller certifications to ensure they are discovering and purchasing from vendors with a variety of different diversity certifications.
“Seller credentials are very important for Johns Hopkins University because we have a lot of grants and part of our contracts is access to diverse businesses,” says Burns.
