The fast-food behemoth is allocating a quarter of its $14 billion yearly supply chain budget to businesses run by people who are underrepresented in the workforce.
McDonald’s plans to maximize its buying from diverse-owned suppliers to 25% by 2025, they announced.
According to the business, the fast-food behemoth spent $14 billion in its U.S. supply chain in 2020, with diverse-owned vendors accounting for 23% of the total. Its new objective is to spend $3.5 billion a year with diverse-owned businesses.
To get there, McDonald’s must collaborate with its suppliers and assist them in making the necessary modifications to suit the company’s needs. In a blog post, Reginald Miller, VP and global diversity, equity, and inclusion officer, uses the addition of apple slices to McDonald’s Happy Meals in 2012 as an example of how a single adjustment in the supply chain may have far-reaching effects.
“We had to work with suppliers around the world to meet our daily demand because our customers consume, on an annual basis, more than 10 percent of all fresh sliced apples sold in the U.S. That is 60 million apples per year,” he said. “It takes time, but it is time well spent.” McDonald’s is also urging other partner businesses to commit to making similar changes. So far, 20 of McDonald’s U.S. suppliers have signed on to the commitment, which the company is dubbing the Mutual Commitment to Diversity, Equity, and Inclusion.
Women, Black, Hispanic, Asian, Indigenous, LGBTQ, veteran, and disabled individuals own companies that meet McDonald’s standards for diverse-owned enterprises.
McDonald’s has made several moves in the past years to improve its diversity and inclusion efforts. Also, it aims to connect CEO compensation to diversity targets and expand spending with diverse-owned media and production partners. McDonald’s, on the other hand, has been accused of racial discrimination against Black franchisees.