For every dollar that Memphis Light, Gas and Water (MLGW) 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.
Locally, a half-dozen Bartlett-based businesses are a part of the utility company’s supplier diversity program. Lakeland has two certified businesses and Arlington has one competing for a piece of the MLGW pie.
Overall, 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.
Even in the new Sheltered Market Program, Judy May, who owns the Bartlett-based Industrial Sales Company of Memphis, is finding she can compete with the best of them.
“You don’t get it because you are minority or woman owned. You still have to be competitive on the pricing,” she said. When as many as six local companies are vying for MLGW’s business, she added, “You’ve got to sharpen your pencil a little more.”
May, a former comptroller at Industrial Sales, borrowed $500,000 and bought the business in 1996 when the previous owner retired. She has been certified as a woman owned business since 1997. The electrical distribution company sells conduit, wiring and electrical panel boards to MLGW, University of Tennessee-Memphis, St. Jude Children’s Research Hospital and others.
The Sheltered Market “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.”
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.
Growing up picking and chopping cotton in Missouri, May, who now lives in Lakeland, never imagined she would one day be a CEO of an award winning company. “I like the fact that I can put nine people to work. That’s my biggest asset,” she said. “They know how to treat our customers right.”
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 Shelby County construction company could be certified as a local small business by the Mid-South Minority Business Council Continuum’s Uniform Certification Agency 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, an electrical materials and supply firm could be certified if it has 500 workers or less or a landscaping firm 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 has done a great job with supplier diversity. 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.