Instead of trying to squeeze more margin out of suppliers, we see the most successful retailers seeking joint solutions with their top suppliers.
The value at stake is tremendous. For example, looking at just the fresh categories in UK, France and Germany alone, we estimate that in excess of $8 billion of combined contribution margin improvement is available from forming retailer-supplier partnerships.
In this article, we describe the most effective ways to identify the right suppliers for collaboration; the main criteria to build a productive retailer-supplier relationship; and key initiatives to run together.
An illustrative screenshot of a supply chain scoreboard to support data sharing
By aligning KPIs, retailers and suppliers are able to get on the same playing field
Product life cycle with joint collaboration
Duplicative actions can be eliminated
Step changing supply chain time efficiency for fresh products
Sharing forecasts, even not completely accurate ones, can optimize processes
