Supplier Diversity has been a hot, hot, hot topic in CPG these days, and with good reason. It brings in new consumers, it shakes up staid categories, and it hacks away at the stranglehold multinational conglomerates have on the CPG industry.

But there’s more to it than that. Here are three even more powerful reasons that supplier diversity is awesome.

  1. Supplier diversity helps people think outside the box
  2. There are only so many different flavors of chips you can put on a shelf. And there are only so many good-for-you ingredients that you can include in a tube of face cream.

    Or so you would think.

    When you bring supplier diversity into the mix, suddenly there’s a bevy of new options for retailers—and consumers—to choose from. Smaller, more diverse suppliers know that they can’t come at the industry with a product that is far too similar to five products already on the shelf. They have to think about their product creatively, and position it as such. That might mean employing packaging that is more convenient than what’s out there, or in a size the likes of which hasn’t been seen. Or maybe it’s a flavor combination, or a new way of producing (think baked, not fried). Whatever it is, those smaller suppliers are on top of it. They’re nimble, they can take more risks, and they can come to market with edgy products faster. And retailers who can inject that out-of-the-box thinking into their product selection will be seen as innovative and encompassing to their consumers who are eager for what’s new and exciting.

  3. Supplier diversity makes the world smaller
  4. One of the greatest things about the CPG industry is you can see the whole world in 4,000 square feet (give or take, depending on the retailer). You can smell and taste and see flavors from the far corners of the earth right there in your hometown, and when retailers diversify their suppliers, that global influence simply explodes. Smaller, more diverse suppliers put their personal influences at the forefront of their products. What might start out as a niche product, when put in the context of a large grocery chain, suddenly becomes mainstream. Exotic flavors are still delicious, but (thankfully) easier to find, making the far corners of the earth instantly accessible.

  5. Supplier diversity shows customer appreciation
  6. When retailers step away from their usual way of doing things, and start incorporating new suppliers with new ideas and new products, they’re essentially showing how much they value their consumer. You know why? It shows they’re listening. It shows they’re continually taking the temperature of their store’s shoppers, and they’re being proactive—rather than reactive—to trends and needs and wants of today’s consumer. Retailers who work hard at supplier diversity are basically saying, “Here, Mr. and Ms. Consumer. I was thinking of you, and got you this.” This, of course, being really cool products they’ve always wanted.

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