Retailer-Supplier Relationship:
Ease of Doing Business Wasn’t So Easy
Reflecting on 2022, we can all see the issues that affected the retail supply chain: labor shortages, high turnover rates in key sectors, unprecedented inflation, and interruptions due to unrest in areas across the world. And of course, this is coming off a nearly three-year global pandemic.
Given the challenges we’ve all faced over the past several years, is it really a surprise that both U.S. retailers and suppliers resoundingly identified ease of doing business as the most important factor in their engagement with one another. Don’t we all want things to just be easy for once?
A timely addition, ‘Ease of doing business’ was a new competency introduced to the Advantage Report in 2022. And while we can all certainly understand why it’s important to both sides of the retailer-supplier relationship, what does that actually mean when it comes to evaluating performance and actioning improvement?
As we enter 2023, we see retailers and suppliers putting more importance on supporting each other’s strategy further deepening collaboration throughout their business.
The Advantage Report identifies the tactical competencies that drive ease of doing business and provides companies with their scores to help diagnose areas of improvement in the retailer-supplier relationship.
Some key takeaways from this year’s best-in-class retailers and suppliers:
- Agile partners are proactive, empowered, and creative: With ever-changing challenges, trend was no longer a useful measure in forecasting demand and strict fulfillment measures (like OTIF) became less important as companies valued partners that demonstrated agility in order to keep products on the shelves and in the hands of consumers.
While certainly an industry buzzword, few companies are doing agility well, as this was one of the lowest performing competencies among both U.S. retailers and suppliers. In practice, we see high turnover, lower levels of experience, outdated corporate organization and policy structures hamper the ability for those on the frontlines to make decisions quickly enough to matter. - Communicate the good and the bad: We all seem to intuitively know that communication is more important now than ever, yet there is a stark difference in how companies that are easy to do business with communicate vs. those that aren’t as easy.
The need to communicate the ‘what’ is always a given, but best-in-class companies don’t skimp on communicating the ‘why’ and ‘how’, especially when it comes to challenges. This year, we saw one supplier with nearly the lowest on-time & in-full score compensate with proactive communication and resolution follow-up to place #2 in the Overall Food Supplier benchmark. - Value your people as much as your customers do: This year, we saw longtime leaders on having capable and experienced people take a hit as companies faced labor shortages and the fall out of last year’s ‘Great Resignation’. Having the right people in place is integral to ease of business, and companies that were able to retain good people through this period have an advantage that will take other companies several years to recoup.
As we enter 2023, we see retailers and suppliers putting more importance on supporting each other’s strategy and delivering on their commitments. Agility will continue to be a requirement as consumers adjust their purchasing habits to compensate for inflation and the workforce continues to flex.
The State of the Retail Industry 2023
JAN 2023
In his current role as Senior Vice President and Managing Director, USA, Richard Cunningham is responsible for enacting the vision of establishing the US as a flagship market for Advantage Group, realizing the business’s full potential by generating consequential outcomes for suppliers and retailers.
Cunningham has over 30 years of experience in CPG, having held leadership roles at Coca-Cola, UTZ Quality Foods and Wise Foods. He has a long track record of driving business performance and leading transformational teams. Throughout his seasoned career, he has been instrumental in revitalizing brands by building relationships and trust with retailers to increase customer retention and brand relevance. Cunningham has spearheaded the development, communication and implementation of effective sales growth strategies and category management for food and beverages to align with retailer goals.
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About Advantage Group
Advantage Group is a leader in the listening and engagement space with over 30 years of experience helping clients unlock the potential in their B2B relationships through world-class data and insights. We know what it takes to build a solid foundation for engagement between retailers and suppliers. Ultimately, high engagement results in mutual growth for both partners.
Further than that, we’re willing to evolve so that our engagement programs better match the needs of our clients today. As an example, clients of Advantage Report can now recalculate their results according to the insights they’re seeking to unveil. Sometimes, organizations have unique needs and require a different program from Advantage Report. This is where Advantage Custom Research Solutions comes in. Advantage Custom Research Solutions offers a suite of tailor-made engagement programs to solve unique problems, navigate complexities and strengthen partnerships. It’s the perfect choice for businesses with specific goals in mind looking to benefit from a completely customized solution. It’s also our responsibility to accommodate the changing business landscape and help retailers and suppliers respond effectively. To ensure that we’re giving our clients feedback, data and insights that reflect the world around them and their current concerns, we have updated and refined our critical competency set to help people and organizations more strategically navigate their relationships. To learn more about how Advantage can support suppliers and retailers on their journey to defend against the supply chain catastrophe and more, contact