This guide was prepared for the prime suppliers of Pepsi-Cola Company to facilitate their support of the M/WBE Program.

This tool outlines the basic definitions and objectives to develop a winning combination between prime suppliers and their customer (Pepsi-Cola) in utilizing minority-owned businesses.

Pepsi-Cola Minority Business Enterprise (M/WBE) Policy

In late 1982 when Pepsi-Cola’s M/WBE Program was established, in the office of the President, the policy was clearly defined and today those same principles are the foundation of Pepsi’s M/WBE efforts.

Pepsi’s goal is to ensure that minority-owned businesses are given the maximum opportunity to provide products/services to meet our needs. We urge you as one of our preferred suppliers to pursue the following:

• Target M/WBE purchases at a level of 5-10% of your Pepsi related revenue.
  

• Provide specs and take extra steps to make matches
  

• Execute an aggressive program
  

• Monitor progress/ensure success
  

• Report to us on a quarterly basis. See REPORTING section for details.
  

Definition of M/WBE

Category One: U.S. citizen - male or female - from one of these major ethnic groups:

• Asian-Indian
  
• Asian-Pacific
  
• Black
  
• Hispanic
• Native-American
• Non-Ethnic Woman
• Other Minority
  

Category Two: We are now tracking Non-Ethnic Women-Owned spending (WBE Code: M5). This spending will be reported separately. Category Two (Non-Ethnic) Women-Owned spending will not satisfy Category One (Ethnic) Minority spending goals.

How Can You Determine If a Business Is an M/WBE?

The easiest method is to ask the business. Use the criteria under definition of M/WBE as a basis for determining M/WBE status. Also, you can request a copy of a Regional Minority Purchasing Council certification, Hispanic Chamber membership or some affiliation from your local ethnic chamber of commerce. Pepsi recommends certification through an NMSDC affiliated regional council or WBENC if woman-owned.

If a potential supplier has none of the above, encourage the owner to contact the National Minority Supplier Development Council (212-944-2430) or the Women's Business Enterprise National Council (202-872-5515) for assistance.

What Is Expected Of Prime Suppliers (Majority Firms)?

Depending on your type of industry, there may be different structures in place to facilitate Pepsi’s request.

The following questions are provided to help guide you in developing or enhancing your commitment to utilize M/WBE and to meet Pepsi’s expectations. We’re not suggesting that you establish a different structure; we merely ask you to use these inquiries to begin thinking about how best to work with us.

1. Does your company have an M/WBE policy?
   
2. Is there a designated individual to contact related to your minority business objectives?
   
3. Are measures in place to monitor and report internally and to Pepsi-Cola? If you have government requirements, check with the individual who handles these reports.
   
4. Do you have minority dealers/distributors/franchisees? If so, utilizing these dealers on Pepsi projects will contribute to M/WBE goals.
   
5. Would you be willing to explore a joint venture or partnership with a qualified and interested M/WBE to meet our future requirements? If so, advise your Pepsi-Cola Manager.
   

Accountability Of Managers

You will need to establish methods of accountability to match other measures for your company. Performance appraisals, bonuses, recognition, etc. might be considered.

Establishing goals and measures for success is necessary to achieve any objective. All departments may not have the same level of opportunity, however, some may have substantial opportunity.
 

Benefits Of Program

America’s diverse marketplace is important to the growth of Pepsi-Cola. We recognize that healthy communities help build happier consumers. The following are just a few of the benefits of implementing a pro-active M/WBE program.

• Minorities form an important part of the U.S. consumer base and are the fastest growing segment.
  
  
• M/WBE's help stimulate economic growth by hiring minorities.
  
  
• Doing business with minorities reinforces corporate responsibility. It is the right business decision.
  
  
• Minority organizations are allies to corporations, and most successful Fortune 1000 companies have M/WBE programs.
  
  
• Outstanding M/WBE programs attract good PR and favorable publicity.
  

Reporting

Pepsi-Cola wishes to identify M/WBE Supplier Spending in support of our business. There are two methods to account for the entire Pepsi system related M/WBE Spending.

• Under Method 1 you would simply report dollars spent with MBE or WBE Organizations as a direct result of a Pepsi-Cola contract. (i.e. $1million spent as a result of $10 million annual contract). Use same process to determine MBE and WBE Spending but report separately.
  
  

• Under Method 2 you would report the percentage of your total corporate MBE Spending equal to the Pepsi-Cola’s contract revenues share of your Total Corporate Revenues. Use same formula to determine both MBE and WBE Spending but report separately.
  
  Example:

  Pepsi Contract Value divided by Supplier Total Revenue and multiplied by Supplier Total MBE or WBE Corporate Spending equals MBE/WBE Spending to be reported to Pepsi-Cola Company ($10 mil/$100 mil = 10% x Supplier Total MBE /WBE Spending)