In yesterday’s section, Brian Miller (Vice President of Services at e-sourcing solutions firm Intesource) discussed vital supply chain topics like building strong supplier networks and appealing to health and ingredient-conscious consumers while keeping costs down. Today’s section further explores supplier relations and strategy development for restaurateurs:
Q: How do firms make sure suppliers have the “seal of approval” and use the healthy, simple ingredients consumers are demanding?
A: Ultimately, it comes down to conducting regular supplier audits. Being proactive about reviews and having proper protocols built into the contract for ensuring ingredient quality will help put greater responsibility on the supplier to make sure their offering is sufficient. Organizations get into trouble when they don’t have the proper visibility into their suppliers’ manufacturing processes.
So far, many suppliers have been quick to get onboard the food transparency movement, and have willingly altered their supply to accommodate preservative, antibiotic and GMO free ingredients. Suppliers for Panera and Chipotle, for example, have agreed to reformulate their recipes to comply with this “no” list. More often than not, suppliers will be willing to work with you, since setting you up for success in meeting consumer preferences benefits them as well. The key is fostering collaborative relationships, and being clear around what’s expected.
Another example: Walmart recently set guidelines for its suppliers around taking human antibiotics out of chicken products. Although the guidelines weren’t mandatory, many suppliers still pledged to follow the new protocol.
Q: What supply chain strategies can restaurants implement to help them stay innovative and competitive in the dynamic market?
A: The supply chain has become a strategic asset for all restaurants. To remain competitive and innovate in this dynamic market, procurement can no longer be solely focused on cost, but on collaboration, quality, agility, and adaptability.
Collaboration across internal departments can go a long way. Think about it – if procurement teamed up with marketing, they’d have a better idea of consumer preferences and market volatility and could forecast and innovate accordingly. PR and procurement could sync up to promote sustainability and quality wins from recent sourcing initiatives, giving consumers more confidence in your product offerings.
It’s also important to expand your souring goals. The key here is finding the right value from your suppliers and ensuring they can offer the right combination of quality, price and terms, giving you the value you need to create a high quality, innovative product for the market.
Stay tuned for the conclusion of this series, focusing on mitigation of risk and the future of transparency.
Click here to read the October 2015 edition of Food, Drink & Franchise!