With an ever-increasing amount of data for food companies, supplier relationship management, also known as SRM (Supplier RelationShip Management), plays a fundamental role in saving time and satisfying the customer. But how can this relationship be integrated into the food industry’s value chain and how can it be better managed on a daily basis?
The collaborative evolution of supplier relationships
In the past, relations between suppliers, retailers and food manufacturers were based primarily on a power struggle. But for some years now, this relationship has been evolving towards a partnership. This notion of partnership, based on trust and the desire for collaborative development, enables employees on both sides to better manage the way they work together, with an emphasis on innovation and customer satisfaction. Whereas negotiation used to play a key role in this strategic collaboration, today it is time for co-construction and sharing. And the evidence is clear: the benefits of a more collaborative vision of the relationship between retailers and suppliers are numerous and guarantee better profitability in the short, medium and long term.
Respect for the design value chain
The value chain is a series of steps that are essential to the final result of the offer. In the agri-food industry, this chain allows the activity to be broken down and the different functions of each operation to be distinguished in order to help each actor to better carry out his mission. This value chain is essential for calculating and analysing costs at each stage of design and production. It also helps to identify the elements with the highest added value for customers. For a value chain to remain fluid, maintaining good supplier-distributor relationships is essential because it is this relationship that allows information to be exchanged as easily and quickly as possible.
The importance of the traceability of each ingredient
The traceability of ingredients and labelling is playing an increasingly important role in the eyes of consumers. It is this traceability that earns the trust of the end customer. It is therefore only natural that Supplier Relationship Management (SRM) should be given special attention to ensure success and profitability in the food sector. Traceability reinforces the importance of close cooperation between supplier, manufacturer and retailer. Without close communication and partnership, the origin of each ingredient becomes a real headache, especially as the volume of data becomes increasingly large.
PLM software: a complementary solution
PLM software, or product lifecycle management software, makes it possible to integrate all the data related to traceability and the manufacturing process. It also integrates business systems and identifies the employees of each company and their roles. It is therefore an effective tool for managing information throughout the life cycle of a product without having to do so manually. However, without an SRM brick, the use of this software is limited since every piece of data for each product must be analysed and entered into the system beforehand.
SRM software: the solution for a better supplier relationship
Since supplier-retailers relations are fundamental to the profitability of a food company, the use of SRM software is indispensable. Because beyond the simple exchange of information and documents, the software allows additional information to be shared about the suppliers’ knowledge. It is in fact a collaborative space that allows for better management of the dispatch, processing of calls for tender, composition and origin of each ingredient, all based on precise specifications. The information is entered directly at the source, which allows better management and control of exchanges, all in a cost-effective manner.
