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.

Overview

The Supplier Diversity Program (SDP) was founded 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), 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 and Opportunity, 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 disability- and LGBT-owned firms, state agencies are encouraged to include them in their purchasing efforts. Only businesses certified by the SDO or SDO-recognized third-party certification organizations qualify for the program.

See links on the right side of this page for:

  • State agency buyers looking for information regarding your department’s responsibilities under SDP.

  • Prime vendors looking for resources to help you complete your SDP commitment.

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 providers, which are introduced in the next section.

How does the SDP work for Purchase of Services Providers?

A Purchase of Services (POS) Provider is a firm that provides health and human services to the Commonwealth.

The POS Provider is required to maintain a business partnership with an MBE, WBE, and/or VBE 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.

Is help available and how can I find out more details?

SDO staff provides information and tools to help Massachusetts state agencies and prime contractors succeed in meeting their benchmarks. These tools include free training, networking opportunities for diverse businesses, assisting prime contractors in identifying potential diverse partners, and publishing an annual report documenting the program performance. Full SDP policy information may be found on our Policy page.

Training classes recommended for vendors wanting to learn more about the SDP are: “Connecting Your Business to the Commonwealth,” “How to Submit an Effective SDP Plan,” and “Basic Supplier Diversity Program Overview.” You can sign-up for a training class from the OSD Training page.

Feedback

Tell us what you think