Supply Chain Solutions for Food Manufacturers: Supplier Diversification
Now more than ever, food businesses need to be more prepared to overcome supply chain disruptions . The remarkable number of factors that place pressure on today’s value chains underscore the importance of business agility. The global pandemic, natural disasters and geopolitical unrest have all revealed how interdependent, intertwined and vulnerable to disruption the food supply chain can be. With inflation on the rise, food manufacturers have a lot on their plate to improve the cost of sales. Food Processing recently reported that a recent survey of 60 food and beverage industry executives noted that supply chain concerns are top of mind for 2022. Business leaders are creating resilience and flexibility through supplier diversification, domestic sourcing, and searching for alternative products.
In this post, we will share details on a handy Icicle feature that helps food and beverage companies make strategic supply chain decisions without losing momentum for production and delivery.
What is Supplier Diversification, and Why Does it Matter?
A recent Deloitte CFO Signals report shared that 69% of finance leaders expect an increase in supplier diversification over the next three years – a clear response to the widespread disruptions over the last few years that have delayed sales, increased cost of manufacturing, and ultimately customer disappointments. Business leaders see multi-sourcing as one of the best ways to mitigate the impact of disruptions, and need to work in partnership with operations and procurement to analyze both projected costing and real-time production cost , as well as the food safety impact of a supplier diversification strategy for their organization.
Effective supplier management is an essential component to success for small to mid-size food manufacturers, especially as they look to sell products to larger customers. Many of the world’s largest food retailers mandate supplier certification to Global Food Safety Initiative (GFSI) schemes such as SQF and BRC . A robust supplier qualification program ensures that your suppliers are certified against the same standards to mitigate food safety risks, and should always be integrated into your supplier audit checklist .
Icicle ERP centralizes all your supplier data to keep track of all audits, assessments and certification records to provide notifications to multiple vendors when third-party certifications are due for renewal to ensure that your entire supply base is up to date. The ability to quickly access information on suppliers simplifies management of a more diverse and localized supply chain to reduce risk for your business.
It’s Good to Know All Your Options and Find Your Best Supplier
An integrated view of purchasing, production planning and logistics for delivery is key to effective vendor management in food manufacturing. Icicle’s unified approach to data management makes it easy to trend data on supplier performance , including lead times as a critical factor during periods of supply chain disruption.
As soon as procurement is flagged that a supplier delivery is running behind (introducing risk of production downtime), users are able to leverage a database of over 1.4 million ingredients to rapidly find alternative suppliers. This gives production teams the option to find ingredient suppliers with shorter lead times to alleviate risk.
How to Look for an Alternative Supplier in Icicle
The Icicle Community includes food manufacturers of food ingredients, as well as suppliers and distributors. Our systems were designed upon the notion that one company’s product could be the ingredient to another’s – so you’ll notice that there an option to adjust the scope of your search to External Only, giving you details on publicly listed products in the Ingredients List interface:
The resulting list gives you an incredible amount of insight into the different brands and suppliers publicly listed on Icicle, which you can assess for local availability to lower your direct costs.
In addition, since other members of the Icicle Community can find products you’ve made available through search, it also means new customers could find you as a new supplier!
Yes, Supplier Diversification is Really That Simple with Icicle
Yes, it’s really that simple to leverage Icicle’s data to grow your supply base and find alternative suppliers for your ingredients. Not only does Icicle have details on other brands, it also suggests information on any potential hazards associated with the ingredients to work into your existing preventive control plans . This is just one of the many ways that Icicle drives food businesses forward into future-proof operations.
Members of the Icicle Community lift each other up through upvoting feature requests that benefit all of our users. Contact our team to learn how you can join the ranks of innovative food manufacturers who are shaping the future of food production with Icicle.