While large purchasing organizations (LPOs) continue to push their supplier diversity and development efforts, disparities remain between minority- and majority-owned businesses. We examine existing disparities, investigate the factors contributing to these gaps, and discuss how LPOs may improve their engagement initiatives with minority-owned businesses, leading to mutual economic success. Through interviews with representatives of minority- and majority-owned businesses, we uncover the difficulties that minority-owned businesses face in accessing LPOs. They receive fewer development opportunities and are less upwardly mobile than their majority-owned counterparts. Trust emerged as a critical factor required for minority-owned businesses to gain access to LPOs. We explore additional factors that may influence LPO procurement decisions beyond racial biases, such as the dense networks of minority-owned businesses, the risks associated with engaging minority-owned businesses, and the complexity of LPO organizational structures. This essay contributes to the operations and supply chain literature on diversity, equity, and inclusion by providing researchers and LPOs with a pragmatic view of their buyer–supplier relationships and strategies to improve contracting practices with minority-owned businesses.
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