5 Steps to Better Store Brand-Supplier Relationships

by | April 27, 2023

Grocery stores have always been essential, but they emerged as vital consumer lifelines during the pandemic. These “essential” businesses dealt with a rollercoaster ride of consumer demand, supply chain disruption, and a heightened focus on operational and product safety.

Their importance remained even after the world crawled back to normal, but a few fundamental changes have stuck around, too. For example, shoppers still love buying groceries online and either taking advantage of home delivery or curbside pickup. And while consumers still prefer dining out, inflation keeps more people at home for meals. And the continued success of store brands persists as if nothing’s happened over the past half-decade.

Store brands had already started outperforming their national counterparts even before the supply chain cratered, and they’ve only become more attractive during the economic recovery through this lingering bout of inflation. For retailers, the lure of store brands remains irresistible – and profitable. These products fill market niches, build consumer loyalty, and boast a lower-cost structure. But any strategy that relies more on private label brands must also address supply chain challenges.

Private label brand owners demand air-tight regulatory compliance schemes and stringent food safety strategies. But unfortunately, in today’s social media age, all it takes is one incident with a single product to tarnish a brand’s reputation.

Fortunately, with a customized private label and food safety program, co-mans can take steps to prevent food safety issues before they occur. This process begins with a strong supplier relationship management program. And with private label brands, if there are quality or safety issues, you don’t get to send it back to the supplier – or blame your brand client – and wash your hands of the problem. Instead, your team must manage the consequences.

Cultivate relationships.

Brands, co-mans, and suppliers all share the responsibility for producing safe, high-quality finished goods. Quality and safety issues can threaten a brand’s reputation – and bottom line – so finding and qualifying suitable suppliers is paramount. Chasing low-price materials can cost brands and co-mans more in the long run, leaving them vulnerable to inferior products, supply chain risk, and even fraud. Soliciting competing bids remains a prudent business strategy, but it shouldn’t dictate the final decision. Instead, co-mans should seek dependable suppliers that share common business values. Healthy, long-term relationships bear rewards, like preferred pricing and better access to market intelligence.

Nurture communication.

Supplier relationships involve the constant exchange of information, so establishing effective lines of communication is crucial. In addition, setting clear expectations for supplier performance, documentation procedures, and follow-ups on corrective actions ensures suppliers comply with company standards and government regulations.

Collaborate. Don’t negotiate.

A better working relationship with suppliers helps co-manufacturers deliver the best shopping experience for customers, keeps costs manageable, and improves operational efficiencies. Co-mans can get there faster by abandoning manual and resource-intensive communications. Digitizing documentation and communication allow both parties to share information quickly and easily, making collaboration seamless. It also empowers everyone to operate proactively rather than wasting time and resources with a less-efficient reactive approach.

Evaluate performance.

As supplier relationships evolve, brands and co-manufacturers must continuously evaluate supplier performance, including metrics gauging product quality and delivery. Effective partners share that information, elicit feedback, and adjust as needed. Formative evaluation not only shores up the retailer’s bottom line; it also leads to more efficient operations. It’s equally important to communicate a job well done and reinforce good performance.

Embrace technology.

Managing supply chain risk often depends on how well stakeholders can track and document the information they receive. Unfortunately, manual processes remain confusing and time-consuming, and they can’t keep up with the flood of regulatory compliance documents and information needed to run an effective program.

A suite of solutions

TraceGains can help.

And Networked Finished Goods is the first co-man solution that ties everything together, providing a comprehensive view of your manufacturing partnerships, the materials flowing through them, and the finished products you deliver. 

Reach out for a demo today to discover how TraceGains can transform your co-man business.

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