Effective Supplier Programs

As an alternative, many companies will require their vendors to fill out a comprehensive survey about their operation, similar to a self-inspection form. This is used in cases when an external auditor or someone from your company is difficult or impractical. This can also be used for highly reputable vendors who supply to other companies and have a respected “track record.”

Regulatory Compliance: The supplier should also demonstrate that they comply with all local, state and federal agencies. This can be proven by reviewing of any regulatory inspections on file.

Specification Compliance Evaluation: Your potential supplier must agree to undergo all necessary evaluations so that they can consistently meet your product requirements, including specification changes that you may require. This can be done through sample exchanges or through the use of an outside lab to test products periodically for specification compliance.

Certificates of Analysis: Your supplier should be able to provide you with certificates of analysis on your purchases. This is an assurance from the supplier that it has tested your product prior to shipment, and specific test results were obtained. This is different from a “guarantee” in that a certificate of analysis documents test results specifically for that product and does not imply that the results are good or bad. A true certificate of analysis may contain unfavorable test results for you, but not for another customer.

It is also important that your supplier agrees to include all testing that you may require, such as microbiological tests, certain chemical tests, pesticide information, as well as other parameters. Many companies also require that each supplier provide a “continuing guarantee,” which typically is a general agreement that all product shipped to the customer will meet all local, state and federal requirements, in addition to meeting customer standards. Guarantees do not contain specific information about the customer’s products.

Returned Goods Policy: It is essential to determine what the prospective vendor’s policy is regarding returning product if it is found to be unacceptable. This should be specified as a requirement prior to approval.

Supplier List and Performance Evaluation

Once your company has established and implemented its supplier-approval program, an actual “approved supplier list” must be maintained and used for all raw material purchases. This approved list should name all vendors, including suppliers of raw materials, and food contact packaging, as well as services affecting food safety and quality (i.e., the pest control company). Only vendors from this approved list should be used in buying any commodity for your business. For emergency situations, procedures should be in place outlining a process for buying from “non-approved” vendors.

Once you have determined who your suppliers will be, a system should be in place to measure the vendor’s overall performance in the supplying of their goods and services. This can be done through a supplier history file or an actual rating system. Feedback to these suppliers is important. It is recommended that routine feedback on the vendor’s performance be provided, rather than only when a problem arises. All companies like to know when things are going well, and ongoing dialogue leads to better supplier and customer relations.

Complaints, Corrections and Communication

Finally, things do not always go smoothly, and you need to measure your suppliers’ ability to handle complaints, returns and implement corrective actions. Any such occurrences should be documented and included as part of your supplier performance evaluation.

As mentioned previously, the element of trust in supplier-customer relationships must be earned. In the food industry, trust is earned by knowing your suppliers well, having specific knowledge about their operations, and having open communication with them. Maintain a good, healthy relationship with your suppliers by informing them regularly about their performance even when things are going well, just as you would when problems arise.