For every dollar that Memphis Light, Gas and Water Division spends for supplies like paper to poles and services like janitorial, security and information technology, 23 cents goes to women owned, minority owned or locally owned small businesses.
Those are the latest findings when MLGW analyzed its 2014 spending as a part of its supplier diversity report.
MLGW spent $33 million – or 23 percent of $144 million – with local, women and minority owned firms. “We are consistently raising the bar with our supplier diversity program,” said MLGW president Jerry Collins Jr. “We want to insure that minorities, women and locally owned small businesses are competitive and receive a fair share of our business.”
The report showed:
- $15.2 million was spent with minority owned firms
- $12.2 million was spent with locally owned small businesses
$5.48 million was spent with women owned enterprises
The 2014 numbers represent a steady three percentage point gain over the last two years. MLGW spent $26.6 million – or 18 percent – of $144 million in 2012 and $33.8 million – or 21 percent – of $160 million in 2013.
Last year the Division also rolled out a new Sheltered Market Program in which 26 companies qualified and were awarded $7 million out of the $33 million in bids mostly in the area of goods and supplies. The race and gender neutral program shelters any purchase under $100,000 by offering three or more certified local small businesses the opportunity to bid on products or services.
“The concept is huge and innovative. This helps us grow,” said Pravin Thakker, president of Universal Scaffolding & Equipment. His business with 16 workers won $4 million in bids providing MLGW with aluminum brackets for street lights, power line hardware and electrical cable. Of the $4 million, less than $1 million came from the new Sheltered Market program.
“Some people’s perception is MLGW is giving away money to local minorities,” Thakker said. “That’s not true. Our pricing has made the process more competitive. We are really competing with the big boys by finding a niche to fill.”
Brighter Days & Nites Inc. is another Memphis company that qualified for the Sheltered Market Program. When owner Dorothy Sinclair started her commercial lighting business in 2003, she said, “MLGW was my first customer; now MLGW is my main customer.”
She estimated out of her $6 million in gross sales last year, about $3.5 million resulted in bids she won selling wiring, gas and water pipes, sealants, optical fibers and cables to MLGW.
The utility company recognized both businesses as two of its four 2014 Sheltered Market Flame Award winners. In addition to the Flame award, Universal won the prestigious national Minority Export Firm of the Year in 2014 presented by the U.S. Department of Commerce’s Minority Business Development Agency.
Jozelle Booker, manager of MLGW’s Procurement and Contracts, hopes local businesses will urge their peers to sign up for the Sheltered Market program. “If we only have two businesses certified instead of three or more, those bids have to compete on the world market,” Booker said. “Companies go online and compete for supplies. We purchase transformers, switchgear and other electric materials from China or Mexico. We are committed to this local market.”
For an example, a construction company headquartered in Shelby County could be certified as a local small business enterprise by the Mid-South Minority Business Council if it has $33.5 million or less in average gross annual sales for the last three years. A majority of the business owners must live within the eight-county Memphis metro area to qualify.
Similarly, a landscaping firm could be certified if it has $7 million or less in average gross annual sales for the last three years.
The idea is to continue creating an economic ripple effect. “We are feeding dollars into the community. If these small businesses grow, they are going to hire more employees,” MLGW’s supplier diversity coordinator Renise Holliday said. “In turn they will buy houses and cars right here in our own community.”
Newly appointed MLGW board commissioner and chair of the Supplier Diversity Committee Carlee McCullough is not surprised by the latest results: “I think MLGW historically has done a great job with supplier diversity. I didn’t expect anything less than that. They have the awards and accolades to support their accomplishments.”
For more information about MLGW’s Supplier Diversity and Sheltered Market Programs, go online www.mlgw.com/sdpolicy, call Mid-South Minority Business Council at 901-528-4381 or attend MLGW’s third annual Vendor Fair June 25 at its Administration Building at 220 S. Main.
MLGW is the largest three-service public power utility in the nation, serving more than 421,000 customers in Memphis and Shelby County.