Johannesburg, 15 Apr 2008
Your suppliers: a critical cog in the FMCG machine. To create a reliable flow of goods from their point of origin to your shop shelves requires a well-oiled supply chain - with its foundation in accurate real-time information.
Ashley Ellington, managing director: Softline Enterprise, says that for products to flow from your suppliers to your customers, up-to-date real-time information has to precede this. This makes integrated applications critical to your supply chain`s success.
Ellington explains that within the supply chain context information needs to be able to pass to, from and within the chain freely.
"Integrated applications are the only means of making this happen. You need to bear this in mind when you first put your applications in place. They must allow ease of integration between your suppliers and your own systems. Solutions must be user-friendly and give suppliers the real-time details they need when they need them."
Developing applications using industry standard tools such as EDI or XML will make this possible, allowing information to be shared across the business. "The more information you feed to your suppliers, the more visibility you create and the more risk you eliminate from your supply chain."
Closely linked to this information sharing is developing strong supplier relationships: creating mutual understanding and consideration between yourself and your suppliers.
"In an industry as fast paced as the FMCG one, by allowing your suppliers into your business you enable them to understand what you do, how you do it, how they can add value to your company, and how they will be rewarded for this," says Ellington.
In a similar vein, by taking the time to understand your supplier`s business and its processes - and how you fit into these - you will discover new opportunities to streamline and make the flow of delivery to you that much more efficient. "You need to employ both your systems to enable your processes."
Ellington uses forecasting to demonstrate what a difference a reliable real-time flow of information can make. "Stock equals money in your supply chain. By sharing forecast information with your suppliers, you enable their planning, thereby ensuring you aren`t sitting with no stock on the shelves when you need it most. You also give them the heads-up when it comes to sourcing additional stock in peak sales periods. Remember that the FMCG market is a fickle one - if the customer can`t get that item at a specific retailer they won`t usually wait for it - they`ll go elsewhere, possibly with their whole shopping list."
The most valuable advice for anyone going into the business of supply chain then is to create a channel for your company`s information before you put your actual supply chain in place. By facilitating the flow of accurate, real-time information between yourself and your suppliers, you`ll ensure that stock doesn`t waste time and money in warehouses and gets to your customers when they want it, where they want it. It`ll also create the perfect platform for a partnership with your suppliers: something guaranteed to ensure your business success well into the future.
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