Building sustainable partnerships through social procurement
Strong relationships are at the heart of successful partnerships between contractors, subcontractors and Aboriginal owned businesses or social enterprises.
In order to foster strong partnerships, contractors need to have an understanding of social benefit suppliers, know how to engage with them effectively, and acknowledge the advantages of cultivating long-term relationships.
Understanding social benefit supplier operating models
Social benefit suppliers differ from commercial entities in many ways:
- social benefit suppliers may hold charitable status and can be owned by non-profits or commercial businesses
- they often balance revenue growth with a focus on impact
- their business models may require longer lead times to scale
- operating costs may be more complex due to direct and indirect costs supporting their social purpose.
Engaging with social benefit suppliers
Depending on your business and where you are on your social procurement journey, various approaches can help you build lasting relationships with social benefit suppliers across your supply chain.
This involves:
- providing mentoring and support throughout the contract
- introducing social benefit suppliers to existing suppliers
- being clear about your needs
- offering regular feedback
- prioritising face-to-face communication where possible
- encouraging open discussions to explore option and find solutions.
This includes:
- sharing upcoming opportunities early
- building and refining your supplier list
- holding exploratory and open discussions.
This could include:
- simplifying procurement and bidding processes.
- exploring single-sourcing opportunities.
- de-bundling work packages to suit a social benefit supplier
- establishing a social benefit supplier panel/pre-qualification system.
This involves:
- offering shorter payment terms or longer contract periods
- avoiding exclusivity agreements to allow working with multiple contractors
- starting with small work packages to increase accessibility
- introducing simplified contract terms and conditions to suit the nature of the works.
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Benefits of establishing long-term relationships
Investing in long-term relationships with social benefit suppliers can lead to several benefits:
Having conversations early and outside of the sourcing process can lead to better and longer lasting collaborations.
Social benefit suppliers often embrace flexibility and innovative ideas. Working together to understand their capability, capacity, and growth goals, makes it easier to identify opportunities.
Building solid partnerships and investment in capabilities mitigates supply chain risks.
Understanding their business model and social purpose fosters quality partnerships, which can lead to better ways of working including managing any issues that come up.
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