How to improve your retail supply chain compliance in one working week

Posted by Jamie Robertson on May 16, 2017

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The retail landscape has changed dramatically over the last decade with technology and software playing an even greater role in our industry.

Not only are consumers taking advantage of this development through online stores, in-store kiosks and transactional iPads, procurement and supply chain professionals are using technology to improve their internal processes too.

One part of the internal process that is getting more attention as a result is supply chain compliance. Despite some retail professionals still relying on spreadsheets to monitor supplier information, the majority have embraced new technology to take away the burden of compliance.

Improve compliance in one working week

Whether you’re operating off a spreadsheet or a new compliance software, procurement and supply chain professionals can always do more to ensure a more transparent, efficient and safer internal process. Using the points below, find out how you can improve your retail supply chain compliance in one working week.

 

Supply chain compliance framework

This supply chain compliance framework was created by Altius to give supply chain professionals the template required to align internal processes and ensure maximum supplier compliance.

Capability

Information – Authorisation – Verification

Judging the capability of your suppliers gives your business a clear indication of their skills and experience to proceed with their products or services. To alleviate red faces internally and potential problems with the work they’ve done, you should be assessing the capability of the supplier right from the very start.

This includes questioning them on their ability, their qualifications and also on the previous work they’ve done. This information gathering will help you verify their claims, making it easier for you to authorise them for use throughout your business. Are you currently doing this effectively?

• Make it as easy as possible for your suppliers to provide their information with a suitable IT system or clear way of communication with your team.
• Keep everything up-to-date. Don’t fall into the trap of doing supplier compliance once and never re-assessing existing suppliers again.
• Integrate your supplier compliance information into your procurement and ordering systems for 100% confidence that non-approved suppliers can’t be used.

 

Management

Policies & Rules – Contracts & Specifications – Controls & Restraints

The job of managing compliance extends well beyond the basics of information and evidence gathering for authorisation to work. Ongoing management of suppliers is required to ensure that contractual compliance is adhered to.

For new and existing suppliers, you should be giving them the relevant policy, rules and specifications to help them adhere to the rules. Your job at this stage is to monitor that they are doing this correctly. Has every one in your supply chain signed and understood all of your documents?

• Create policies that clearly explain what you expect and want to see. Suppliers aren’t likely to behave how you would like them to if they don’t understand what that is.
• Use contracts to clearly explain what you want and expect. Include details on documentation, timescales, behaviour and reporting.
• Clearly communicate the things you do not want the supplier to do as well as the things you do. Get their agreement that they understand this and will co-operate.

 

Monitoring

KPIs – Behaviour – Audit

To ensure that your supplier abides by your contractual agreements and meet their targets, you need to have a system in place so that you can monitor their progress.

This can be in the form of an audit which will assist in identifying areas for improvement; it can also assess the performance of your suppliers, which is crucial to maintaining high standards. Have you set KPIs for your existing suppliers in the past and audited them against their results?

• Give suppliers feedback and credit for good conduct. It’ll encourage them to do the right things and let them know it is not going unnoticed.
• Audits are relatively expensive so optimise them by targeting areas that need improvement or carry risk.
• Use KPIs to provide routine feedback on how your suppliers are doing. Make sure these results are communicated back to the supplier.

 

The importance of compliance

The importance of compliance, particularly in the consumer-facing retail industry, is paramount. By using these nine points above to question your internal process, you will effectively review and begin to improve your retail supply chain compliance as soon as possible.

Want to know more about how new retail trends will impact on you? Download our guide Retail 2020: A future insight of trends that will affect facility and property management and discover how retail trends will change the way you do supply chain compliance in three years’ time.