Nine Best Practices for Managing Global Suppliers
When it comes to managing a global supply chain, things can get complicated – fast. Managing data from global suppliers, which can be inconsistent or non-existent, remains a cumbersome and challenging task. But there are steps companies can take to ease the burden.
Best practices when it comes to global suppliers
- Know your suppliers. Get to know your global suppliers and visit them in person whenever possible. You can’t get a complete view of your suppliers until you set foot in their facility. You can determine which suppliers might need more frequent visits depending on your internal risk assessment.
- Set minimum standards. We operate at a time when merely handing over quality responsibilities to the procurement group isn’t enough anymore. Quality must be an active part of the entire global sourcing team. So, when procurement goes out to finalize deals, QA needs to tag along to ensure suppliers can meet your company’s quality standards.
- Take Certifications at face value. When it comes to higher-risk countries, take certifications at face value. While you can trust your suppliers, you’ll want to verify all certifications before reaching conclusions. TraceGains customers have shared stories of visiting suppliers who quickly brandish their BRCGS certificate but can’t pass a simple GMP audit. Trust, but verify.
- Build relationships. Encourage your sourcing group to foster relationships with suppliers you’ve identified as capable of manufacturing your items. Maintaining relationships can help prepare for sudden sourcing shifts or rapid growth.
- Leverage Global Food Safety Initiative (GFSI). Use GFSI as much as possible and have contracts and import protocol agreements in place. If you sign another supplier facility, aside from the standard contracts, have them sign an import agreement. This agreement not only documents essential information, but it informs the supplier of the steps you’ve established to verify compliant products.
Best practices for specific products
- Keep updated product specifications. Encourage teams to draft comprehensive product specifications. You must leverage your specifications because if you don’t have them in place, chances are you’ll get an industrial specification available to any other company. And if that’s the case, how will you differentiate your product from your competitors?
- Conduct product audits. Make sure to conduct product audits and always look at production records. Occasionally engage the services of third-party auditors to drop into facilities unannounced and conduct product audits. Third-party auditors can also perform pre-shipment inspections and report all results to your company.
- Ensure label compliance. In some cases, it’s unacceptable to use U.S. labels in other countries (Asia, for example, prohibits U.S. labels), so there are times when you must contract with local labeling companies. In these situations, it’s crucial to determine who’ll be looking at those labels and who’ll ensure those labels are compliant. Ask questions and regularly have suppliers send you the labels to keep in your records and ensure they meet your compliance regulations. Prioritizing risk at the material and supplier levels is essential for effective supply chain and safety management. However, barriers still exist that hamper accurate and complete risk assessment—namely, risk intelligence, personnel, and technology.
- General QA best practices. Always watch for the usual suspects – the same things QA’s always careful to note. Relevant factors include ethical sourcing, underage/slave labor, environmental impacts, and sustainability.
Managing risk in today’s market is more challenging than ever. Find out how TraceGains can help your company better manage risk in our eBook, “Managing Risk in the Global Supply Chain.”