- Contract Packaging
- Leaders in Packaging
Article | September 30, 2000
Supplier partnerships encouraged in purchasing (sidebar)
What do supplier partners gain?
Naturally the prime benefit of a real partnership for a packaging supplier is the contracted business volume from the relationship. Usually companies that attempt to consolidate the number of vendors they buy from will award significantly more business to these partners. And if the bonds of the relationship are strong there’s usually a potential for greater involvement in the packaging process that can offer even more opportunities.
The senior procurement manager of a major snack maker says his supplier partners will enjoy “longer-term contracts. Then they’ll gain new business if we add new SKUs within the same packaging material. For example [our] glass supplier will gain new business if we add new products in glass.”
Better scheduling of packaging productions runs is a benefit cited by the senior buyer for a poultry processor. “We’ll provide four-week projections on packaging material needs. This will help our partner to develop his weekly production schedule so they can maintain the appropriate inventories for our needs.” Perhaps even more important this buyer hopes the supplier will have available “a facility to test-run new or improved materials” he says.
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Helping improve quality
The procurement specialist for a photo film maker says its partners should expect to increase the overall quality of its products. “Due to our quality demands our business partner becomes a better overall supplier. We introduce tighter tolerances to them different high-profile packaging than they normally make. Because of our product needs our partners’ quality will improve not just for us but also for their other customers.”
This was also emphasized by the packaging buyer for a lawn care products maker. “Our Quality Assurance audit program helps our partners become better companies to serve all their customers better. Our industry leadership teaches partners how to make the capital expenditures so they can become packaging leaders.”
The senior buyer for a medical device maker says its partners will learn from “working with ISO 9001-certified and GMP-compliant companies and people.” The chief purchasing manager for a major supplier of writing instruments says that his company works to make its partners more efficient. “We make a commitment to our partnering suppliers that we’ll provide assistance in helping them make their operations more efficient.”
A purchasing agent at a national maker of personal care products says that partners will have access to more people and departments within his corporation. “Not only do our partners receive preferential consideration they also participate early on in drawing up our specifications and they gain access to other departments to learn about other projects.” The senior buyer for a medical products manufacturer says its partners have the same advantage. “As our business expands into new markets so will theirs. And partners for one division will have an entrée to other manufacturing groups within our corporation.”
This was echoed by the purchasing manager for a contract packager. “Not only do we develop a long-term relationship with our partners but they often gain new business from referrals by our people.” A distiller’s senior purchasing agent says his company goes even further. His company’s partners gain from his company’s “referrals to others including our competitors.”
The senior buyer for a national food processor states simply “Partnering vendors are made a part of our package development process.” The business analyst for a national personal care products maker says his company’s partners “will receive more insight into the forecasts and company direction to better help them plan their production and even their research and development efforts.”
Following up on that the purchasing manager for a chemical company says its partners gain “reliable orders for up to three years. This helps lower their sales acquisition costs” he predicts. A purchasing agent for a meat processor says partners “should be able to reduce costs due to efficiencies gained from order contracts.”
Many of the respondents were more concise simply stating that vendors will enjoy “greater security” or the chance to become “exclusive supplier to our entire corporation.”
The purchasing manager for a flexible packaging converter says his company’s partners will “participate in our new technology efforts as well as gain access to our new markets and customers.”
That was also cited by the purchasing manager for a food processor. Not only do his company’s partners gain from the “lockout of competition” he says but the company “shares with them new technologies that are appropriate to our plans.”
Finally one purchasing manager cited a partner benefit that all would appreciate: “quicker payments from 30 to 15 days.” And another buyer cited “fewer phone calls” between partners.
See the main story that goes with this sidebar: Supplier partnerships encouraged in purchasing
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