The Indigenous business sector in Australia is experiencing rapid growth, evolving from just a handful of enterprises to over 5,000 today. This momentum highlights the crucial role of Indigenous businesses in our economy and the importance of inclusive procurement practices. Recent policy updates, strategic insights, and real-world examples underscore how we can better engage Indigenous suppliers, foster genuine partnerships, and deliver meaningful social outcomes.
Earlier this year, VendorPanel invited three expert panelists to share their perspectives on how to increase engagement and participation between Indigenous-owned businesses and procurement teams. The panel included Luke Kenny, CEO at Local Government Procurement, Diem Huynh, CEO at Sedo Group, and Kim Collard, Founder/Executive Chairman at Kulbardi & The Bibbulmun Fund.
The sixty-minute discussion unpacked common engagement challenges, key progress that organisations are making and tips on how organisations at the start of their journey can make meaningful impact.
Below are four key takeaways from the discussion:
1. Break Down Barriers Through Smarter Contract Design
Large contracts can unintentionally exclude Indigenous and small businesses. Breaking them into smaller, manageable work packages makes opportunities more accessible. Councils and contract managers must design these packages thoughtfully to attract a broader, more diverse supplier base. Platforms that allow Indigenous businesses to self-register and join panels, coupled with transparent spending, further reinforce positive social impact.
2. Invest in Capacity Building and Support Genuine Engagement
Historical exclusion means Indigenous businesses often face barriers that others do not. Capacity building through training, development programs, and policy support like the Indigenous Procurement Policy (IPP) and Aboriginal Procurement Policy (APP) is essential. Equally important is tackling "black cladding" — where non-Indigenous firms exploit Indigenous partnerships for contracts — by conducting proper due diligence and engaging with certified Indigenous suppliers via organisations like Supply Nation and Indigenous Chambers of Commerce.
3. Enhance Social Procurement Strategies
Social procurement is about more than ticking boxes. It's about buying differently — setting clear targets, providing support, offering faster payment terms, and celebrating successes. Practical measures like paying Indigenous suppliers weekly or fortnightly can significantly boost their financial sustainability. Building trust and long-term relationships within the supply chain creates stronger, more resilient communities.
4. Adapt to Policy Changes and Focus on Certified Suppliers
Recent updates to the Indigenous procurement policy now requires businesses to be at least 51% Indigenous owned to qualify for contracts. This ensures genuine economic empowerment and reduces the risk of black cladding. Focusing on certified, not just registered, suppliers through groups like Supply Nation and Kinaway ensures authenticity and compliance. Even though there’s no mandated Indigenous procurement target for many local governments yet, setting voluntary targets can position councils as leaders in diversity and inclusion and set them up for success when mandates do come in.
To effectively engage with Indigenous businesses, a comprehensive approach involving education, collaboration, and inclusive procurement strategies is required. Changing procurement practices to actively include Indigenous suppliers can drive social value and empower Indigenous communities economically.
Initiatives like LGP's Indigenous procurement pre-qualification scheme exemplify how procurement can support Indigenous businesses.
Final Thoughts
The integration of Indigenous businesses into mainstream procurement is not only a moral imperative but also a smart economic move. Through commitment, education, and genuine engagement, organisations can create lasting impact that goes well beyond the balance sheet.
Technology platforms like VendorPanel make it easier for organisations to engage directly with Indigenous suppliers, simplify compliance, and build a procurement approach that supports significant social and economic impact. By working collaboratively and strategically, we can help contribute to a more inclusive future.
If you’re ready to learn more about how our tools can help you create meaningful impact for Indigenous suppliers, get in touch today.
