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Learn about the Supplier Diversity Program (SDP)

The SDP encourages the award of state contracts in a way that strengthens and increases business opportunities for diverse companies.
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Table of Contents

Overview

The Supplier Diversity Program (SDP) was established to promote supplier diversity in public contracting. The program encourages the award of state contracts in a way that strengthens and increases business opportunities for Minority Business Enterprises (MBEs), Women Business Enterprises (WBEs), and Service-Disabled Veteran Business Enterprises (SDVOBEs). In 2015, the SDP was expanded to include Veteran Business Enterprises (VBEs), Lesbian, Gay, Bisexual, and Transgender Business Enterprises (LGBTBEs); and Disability-Owned Business Enterprises (DOBEs).

What you need to know

The Massachusetts Supplier Diversity Office (SDO), working with the Governor’s Office of Access, Opportunity, and Community Affairs, sets spending goals for Executive Departments, also called benchmarks, for purchasing from minority-, women-, and veteran-owned businesses. While spending goals have not yet been established for DOBE- and LGBTBE-owned firms, state agencies are encouraged to include them in their purchasing efforts. Only those businesses certified by the SDO or SDO-recognized third-party certification organizations qualify for the program.

How does the SDP work?

Throughout the year, each state agency undertakes a range of efforts to meet the benchmark spending goals through direct and indirect spending. These terms are explained below.

  • Direct spending is when state agencies purchase goods and services directly from diverse businesses.
    • While diverse businesses do not receive special treatment in the bidding process, if awarded a contract, their certification serves as a marketing tool.
  • Indirect spending means that businesses awarded large contracts (also called prime contractors or prime vendors) for goods and services are required to make measurable financial commitments to do business with one or more diverse businesses (often called SDP Partners). This requirement applies to all goods and services contracts expected to exceed $150,000 in total spending.
    • Prime contractor commitments are based on a percentage of sales earned from the state contract. Prime contractors also are required to report that spend at set times during a fiscal year.

There are special rules for Purchase of Service (POS) providers, which are introduced in the next section.

How does the SDP work for Purchase of Services Providers (POS)?

The POS Provider is required to maintain a business partnership with an MBE, WBE, VBE, DOBE or LGBTBE business certified by the SDO or an SDO-recognized third-party organization. However, the financial commitment to SDP partners is a fixed dollar amount, instead of a percentage of sales. Further, there are specific reporting forms that must be used by POS Providers.

Which businesses are eligible to serve as SDP Partners?

Businesses appearing on the following lists are eligible to serve as SDP Partners:

Program Resources for Departments

Best Practices for Departments 

  1. Use more certified contractors in your purchasing. When choosing contractors, increase the use of certified diverse and registered small businesses in a manner consistent with policy/contract requirements (e.g. if a contract requires three quotes, include certified contractors in RFQ distribution).
    • Download the Contractor Certification Status Report to find diverse and small businesses on statewide and departmental Master Agreements.
    • Request a custom Vendor Utilization Report for your department to compare currently utilized contractors with available diverse and small contractors on the same statewide or departmental contract.  To request the report please contact the SDP Help Desk at sdp@mass.gov.
  2. Encourage current contractors to get certified. Encourage your departmental contractors to consider diversity certification and small business verification in COMMBUYS. 
  3. Consistently collect SDP spending data from departmental contractors. Once collected, provide SDP spending information to the SDO to receive credit toward meeting your department’s benchmarks.
    • At least every six months, distribute SDP Plan Form 3, SDP Spending Report to departmental contractors. Compare reported spending with the contractors’ SDP commitments. At the end of the fiscal year, submit all collected reports to the SDP Help Desk at sdp@mass.gov.
  4. Help contractors create successful SDP relationships with certified vendors. Clearly communicate to bidders and contractors that SDP plans and spending reports are valuable to your department. Refer bidders and contractors to SDO resources.
  5. Promote upcoming procurements to certified businesses: Work with SDO to notify diverse and small businesses of upcoming procurements.
    • Use the SDO’s online Directory of Certified Businesses to download lists of certified businesses by industry to market upcoming bids or contact the SDP Help Desk at sdp@mass.gov to request that the SDO send out this notification on your behalf.

Program Resources for Bidders and Contractors

Contact

Online

Address

1 Ashburton Place, Room 1017
Boston, MA 02108

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