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Mission-Driven Purchasing: A Strategy for Nonprofit Procurement Leaders

Learn more about the benefits of mission-driven purchasing and how procurement leaders can be change agents in this focus area

In the realm of nonprofit organisations, procurement has traditionally been viewed through the lens of cost efficiency. However, an emerging paradigm shift towards mission-driven purchasing is redefining the role of procurement leaders in the sector. This approach recognises procurement as a strategic function that can play a pivotal role in advancing the organisation's mission.

 

Mission-driven purchasing is about aligning procurement decisions with the organisation's core values and mission. It is about going beyond cost considerations, considering the social, environmental, and economic impacts of procurement decisions. For example, a nonprofit organisation committed to environmental sustainability might prioritise purchasing from suppliers with strong environmental credentials.

 

Embracing Mission-Driven Purchasing

The benefits of this approach are multi-fold. It strengthens the organisation's reputation, enhances stakeholder engagement, and creates a positive impact on the community the nonprofit serves. Furthermore, it enables nonprofits to use their purchasing power to foster positive change, whether that's supporting local businesses, promoting fair trade, or reducing environmental footprint.

 

Benefits to nonprofit organisations engaging in mission-driven procurement include:

  • Increased loyalty: According to Givinga, companies (including nonprofits) that are mission-driven tend to have higher rates of customer loyalty. Customers are more likely to continue supporting organisations that align with their values and contribute positively to society.
  • Appeal to donors: Inc. published an article in 2023 featuring a company embracing mission-driven marketing. Two-thirds of consumers in the survey consider a company's purpose when making buying decisions. Nonprofits that engage in mission-driven purchasing can demonstrate their commitment to their mission, appealing to this demographic and potentially increase their funding.
  • Enhanced efficiency and outreach: By intentionally selecting goods and services from local or minority-owned businesses, nonprofits can effectively uplift and support marginalised communities. This not only enables these organisations to drive economic growth in these communities but also reinforces their dedication to diversity and inclusivity. An additional benefit is that deliveries may even be expedited when your supplier is nearby.

“Nonprofits can force-multiply a one-time investment by ensuring there is a strategic procurement plan surfacing suppliers that align with the mission, such as locally owned business for a community food bank.”

— Sean Ullman | Senior Account Executive, Nonprofit, Amazon Business

Strategies for Implementing Mission-Driven Purchasing

To succeed in this new role, a holistic understanding of the organisation's mission and the broader social and environmental context it operates within is crucial. You'll need to build strong relationships with suppliers who share your organisation's values, and develop procurement policies that reflect these values. And, most importantly, you'll need to champion this approach within your organisation, advocating for its adoption across all levels.

 

Procurement leaders looking to drive these types of changes in their organisation should engage in the following tactics:

  1. Eliminate Data Deficiencies: By eliminating data deficiencies, procurement leaders can make more informed, mission-aligned purchasing decisions. Digital transformation, even in small ways, can continue to help surface more data.
  2. Develop Clear Policies: Detailed policies outlining procedures for purchasing goods and services can ensure alignment with the organisation's mission. This can extend to policies that determine what employees buy. Some suppliers can even help you guide your employees towards purchasing products with preferred certifications (ex. Climate Pledge Friendly)
  3. Utilise value-based purchasing: value-based purchasing can involve choosing suppliers who align with the organisation's mission and values, even if their prices are higher. For example, a nonprofit might choose to purchase from a supplier that employs disadvantaged individuals, in line with the nonprofit's mission to support such individuals. Some suppliers, like Amazon Business, utilise their procurement hubs to help you identify relevant businesses.
  4. Support local partners: When you consider the fact that 66% of local businesses give to charity, you start to see great synergy and opportunity. Purchasing from local vendors will likely have a direct impact on your own success.

 

Future Perspectives

Mission-driven purchasing is not just a trend, but a strategic imperative for nonprofit procurement leaders. By embracing this approach, you can position procurement as a powerful tool to advance your organisation's mission, create positive social impact, and drive meaningful change. Be the change agent your organisation needs – lead the shift towards mission-driven purchasing.

 

To make the most impact, it's crucial for leaders to connect with their suppliers early in the year. By doing so, you can collaboratively game plan and strategise for the rest of the year, ensuring alignment and maximising the positive outcomes of your mission-driven procurement efforts.

Learn more about how Amazon Business partners with nonprofits

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