Retail buyers need to go back to basics

10/17/2013 10:45:00 AM
Tom Karst

Tom Karst, National EditorTom Karst, National EditorWhy is everybody concerned with rating suppliers and no one cares about ranking buyers?

Suppliers get multiple food safety audits, increasing scrutiny of their sustainability practices, stern notes about Produce Traceability Initiative progress, and even an occasional interested glance from buyers about their employee relations.

Turn the tables. If a supplier was creating a matrix for its best customers, what factors should be on the scorecard?

A short list of some attributes I would probably track would include pay practices, profitability, growth potential, minimum orders, and most importantly, longevity as a loyal customer.

Also big: Was the buyer there when the market went in the tank or did they bail and book elsewhere?

I know some suppliers do rate the pay practices of their buyers. Credit rating services like the Red Book help put a common value on the pay practices and other financial attributes of produce buyers.

Beyond buying power and prompt payment, what other factors could be on the matrix?

Someone said “what is good for the goose is good for the gander.”

So, should issues like sustainability practices, social media savvy, food safety training, creativity in consumer promotions, history of labor relations, PTI compliance and community charity efforts also be a part of a supplier’s matrix of how he scores a buyer?

The mere idea is laugh-out-loud funny.

The party in a transaction with the most power usually sets the rules. For most of the time, the ones wielding the power are buyers because there is typically more supply than demand.

For that reason, suppliers must submit to multiple audits for food safety and the likelihood of increasing paperwork requirements for sustainability and social issues like worker welfare.

You already do a Primus audit? We don’t care, you must do the SQF or GlobalG.A.P.

But suppliers sometimes hold the edge. With a hard to get variety like Honeycrisp or perhaps a niche variety of apple or other fruit, the shipper enjoys the prospect of choosing whom to sell to.

Faced with a scenario of choosing between two buyers willing to pay the same amount for a carton of Honeycrisp apples, why don’t shippers put their buyers under the microscope?

“I’d love to sell you this load of organic Honeycrisp, but could you fax me a copy of your chain store’s progress report on PTI?”

No, PTI would have nothing to do with the selling decision. If two buyers were competing with the same market, the one who has been a regular customer will get the business over the buyer who just called from out of the blue.


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