Buying for Impact: How to Buy From Women and Change Our World is a new inclusive-sourcing “how-to guide” for visionary corporations, governments, multilaterals, non-governmental organizations, and consumers that want to buy from women business owners.
Below are some important facts on women and women as business owners:
• Women perform 66 percent of the world’s work and produce 50 percent of the food, but only earn 10 percent of the income and own 1 percent of the property.
• Women invest 90 percent of their income in their households, as opposed to men’s 30–40 percent. Where women control household income, the family’s health, nutrition and education improve at a faster rate because less money is spent outside the household.
• Women dominate the global marketplace by controlling $20 trillion in consumer spending, and that number is predicted to rise to $28 trillion by 2014.
• There are approximately 187 million women entrepreneurs worldwide who own at least some of 32–39 percent of all private businesses in the formal economy.
• More women than men entrepreneurs introduce innovations (new products and services) in developed economies.
• In societies where women perceive they have the capabilities for entrepreneurship, there is a greater likelihood women will also perceive entrepreneurial opportunities. However, fewer women (47.7 percent) than men (62.1 percent) believe they have the capabilities to start and run businesses.
The full economic impact that women-owned businesses can have on our global economies has not yet been realized. More money in the hands of women will have a positive impact on how we invest in our communities.
However, organizations and individuals who should be buying from women do not generally know how to buy from women. And the women who should be selling into larger markets do not generally know how to sell into larger markets.
When we undervalue and underutilize the contributions of half the population, we all suffer the consequences because we have fewer options or solutions available in the market.
Buying for Impact highlights buyers and women suppliers who have cracked the code and have learned how to do business with each other through WEConnect International. It also outlines how the public sector, the private sector and civil society can work together to create a more enabling environment for women seeking an equal opportunity to compete.
Global Barriers for Women
Women face barriers when trying to start new businesses or grow existing ones. They run into these strategic and operational brick walls: less access to credit, training, technology, markets, role models and protection under the law. They also face obstacles—legal, institutional, cultural—that add to the complexity of achieving success, as well as centuries of tradition that narrowly define the role of women in the community and the family.
If women are to play a more powerful role in building strong communities and sustainable economies, women entrepreneurs must own more of the means of production. Women need clear incentives to move from the informal sector to the formal sector. Women also need access to business knowledge and networks that can help them grow their companies, create wealth and deliver jobs.
Consistent with the societal and legal trends of equal opportunity, affirmative action, the civil-rights movement, and the evaluation of the Baby Boomer generation, in the 1960s and 1970s, many large U.S. conglomerates, such as IBM and AT&T, launched their formal supplier-diversity initiatives.
However, there is still a lot of work to be done and objectives yet to be accomplished. Think about this: Women-owned enterprises in 2012 represented less than 1 percent of the total global procurement and vendor spend of the Fortune 1000. Not only is this disparity inherently unfair, inefficient and imbalanced, but it represents a lost strategic and societal opportunity for the advancement of a corporation and its stakeholders; the millions of women-owned businesses around the globe and their stakeholders; consumers; and our overall global economy.
Value of Diversity Metrics
One of the great challenges of launching global-supplier diversity-and-inclusion programs outside the United States is the almost total lack of good data on what buyers are doing to engage women business owners and other diverse businesses based outside the United States.
DiversityInc, a WEConnect International partner, has expanded its Global Diversity Research survey to include new questions specific to global-supplier diversity and inclusion. The new questions will help measure exactly what corporations are doing to source more inclusively from women-owned businesses and other underutilized businesses that are based outside the United States. By asking these questions, DiversityInc is bringing visibility to this important aspect of diversity and encouraging survey participants to do more in the area of global-supplier diversity and inclusion because their answers will have a direct impact on their total score and list placement.
Examples of global members using the WEConnect International online database to find women business owners in more than 50 countries include: Accenture, AT&T, The Boeing Company, The Coca-Cola Company, Cummins Inc., Ernst & Young, Hewlett-Packard Company, IBM, Johnson & Johnson, Manpower Inc., Marriott International, Microsoft., Pacific Gas and Electric Company, Pfizer Inc., Verizon, Walmart Stores Inc., WellPoint, Wyndham Worldwide, etc.
It is time for all of us to work together to move the needle in a more robust and purposeful manner. Proactivity and improvement in this area is not just about equality; it’s about building a stronger and more balanced economy. It’s about opportunity creation, wealth creation, innovation creation and job creation.
For more information, please visit www.BuyingforImpact.com
Elizabeth A. Vazquez is the CEO and co-founder of WEConnect International. Andrew J. Sherman is a partner in the law firm of Jones Day who focuses on strategic business growth.
Case Studies: Impact on Women-Owned Business
• Duinkerken Foods in Canada anticipates 25 percent growth in revenue and hiring 12 new positions after its products became listed on Walmart.com.
• Great Sea Public Relations in China is an IBM vendor now also doing business with Cummins. In the past year, Great Sea had to change offices twice because of its rapid growth.
• Dongzin Tea Company, also in China, signed an agreement with Walmart to sell mint tea in selected Walmart stores in China.