Procurement with purpose: buying goods, services & impact

Blog entry
Date: 
09.12.2014
Author: 
Andy Daly

Buying goods and services is a basic, fundamental part of doing business, but it can create quite a powerful ripple effect in the wider community. In some ways, the greatest impact a company can have is through its procurement, and by looking at their day-to-day purchasing decisions companies are starting to move beyond traditional CSR and towards creating social value through their core business activities. ‘Social impact through procurement’ is the tagline of our Social Business Partnership (SBP) venture, and it is clear that procurement is becoming a strategic, value-add function like never before.

This increasing focus on socially-impactful procurement is part of the wider responsible business agenda, which has many drivers. First and foremost is the shifting role of the public sector, from delivering services to commissioning services. This shift means that private sector actors are finding they have more and more visibility, influence and power in the communities they operate in, and with this comes the recognition that they are not locked into a zero-sum game; responsible corporate behaviour brings benefits which can be shared by both business and the wider community.

Another driver is the coming of age of the millennials and the rise of the ethical consumer, with corporate activity being scrutinised more than ever. Companies need to work harder to gain and maintain consumer loyalty and employee engagement.  Trust is an issue which is often mentioned to us by companies which feel they need to do more to win it, or win it back.

Legislation has also played a part in nudging the private sector. The Social Value Act, which has been in force for almost two years, is a genuine driver for any private sector businesses which sell into the public sector. The Act is currently being reviewed by Lord Young, the Prime Minister’s Adviser on Enterprise, and one of his recommendations when he reports early next year may be to extend the legislation to cover contracts for goods and works as well as services. In other words, this legislative nudge for private sector actors to demonstrate they generate social value may become even stronger.

Building supply chain relationships with social enterprises is an attractive solution for companies which want to have a more positive impact within their local communities, as social enterprises are experts in delivering innovation and social value. The principle is to look at how the business buys things, rather than what the business buys; if you already use a logistics company for your events, there may be greater benefit to your business and society as a whole through using a social enterprise instead, such as Connection Crew. And there is good news for those who are searching for social enterprise suppliers:

1.       There are a lot of them. The last estimate was 70,000 in the UK and this number is rising all the time.

2.       They offer a wide range of services which large businesses need, from catering, cleaning and communications to workwear, waste management and washroom products.

3.       Specialist brokerage services, such as Social Business Partnership (SBP), can do all the hard work for you by finding the best suppliers for your requirements.

The opportunity is clear: why settle for buying goods and services, when you can buy goods, services and impact?

Moving from compliance towards a genuinely impactful supply chain is a journey. In our experience, it is an exciting journey and one that can transform the way you do business. We would love to see more and more companies on this journey; for an exploratory chat to see how SBP could work for you, please contact Andy Daly at a.daly@socialbusinesspartnership.com or on 02076201211.

 

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