Overcoming Barriers

promising solutions to common challenges
Challenge Solution
Contract is too large for any existing local and/or diverse vendor to handle on their own. Break up the contract into smaller sizes, unbundling particular items.

Require partnerships between large, majority vendors and smaller local, diverse vendors.

Encourage tier-one vendors to subcontract to smaller local, diverse vendors

Examples: University HospitalsParkland Health and Hospital SystemGrady Health System, CHRISTUS Health, Duke University Health System

Existing contracts prevent switching to or working with a local, diverse vendor. Leverage contract renewal negotiations to encourage current vendors to sub-contract with local and diverse vendors.

Examples: University HospitalsDuke University Health System, Johns Hopkins Hospital and Health System

Sector considered too competitive for mentor-protégé relationships.


Pair vendors from different sectors around common business functions such as back office support, etc.

Examples: MD Anderson Cancer Center

No existing vendors provide the good or service needed. Identify local philanthropic, business development, cooperative development, local government, anchor institution and/or other partners to incubate a business that provides that good or service

Examples: University Hospitals, University of Chicago, Cleveland Clinic

Potential local, diverse vendors have no healthcare experience. Utilize sub-contracting, contract “flipping,” or mentor-protégé relationships to help local vendors build capacity.

Conduct vendor education around healthcare-specific requirements.

Identify lower risk opportunities for initial contracts.

Examples: MD Anderson Cancer CenterMedical University of South Carolina (MUSC),

Item cannot be procured locally. Focus on localizing distribution channels:

Include requirements in contracts such as working with local distribution companies, warehouses, or transportation services.

Offer the opportunity of a long-term contract to encourage a firm to expand to your location and require inclusive, local hiring.

Examples: University Hospitals, Charleston Area Medical CenterDuke University Health System, Johns Hopkins Hospital and Health System

Public regulations prevent preferences for local and/or diverse vendors. Require local and diverse participation forms with bids that ask for a statement on how they will encourage local and/or diverse purchasing

Examples: Parkland Health and Hospital System

Contract with Group Purchasing Organization (GPO) limits the amount of discretionary spending available. Leverage future contracting opportunities with GPO to encourage a switch to local and diverse vendors.

Encourage GPO to identify local, diverse options as its customer.

Develop plan to reduce institutional dependency on GPO procurement.


Parkland Health and Hospital SystemUniversity Hospitals