A relationship with a supply chain with a pure top down mindset has its limitations. When a vertical framework becomes part of a culture, partnerships and profitability are gained.
To many retailers is it a case of creating new habits and working with others on a journey where guidance and access to trusted sources become key?
In the recent IGD Supply Chain Summit (in London, November 2016), Asda VP Commercial Operations, Chris West highlighted the need to minimise complexity and the brand to become more collaborative and reliable, not just internally.
West commented, “We need to be sharp about what we do in the future. We need to always be moving forward, or we will be left behind.”
This is an approach adopted by Great Little Trading Company (GLTC) in the build up to their first ever store launch in Wandsworth (during 2016).
Claire Aldersley, Resolution Interiors Creative Design Manager highlighted, “Everything started with a new building and how to design it.”
“We worked together with a 360-degree framework from creating a destination location through to producing a showroom. GLTC were open from the outset that they wanted to work with a supplier at an embryonic stage of their physical retail journey.”
When it comes to creating a collaborative partnership, Claire highlighted the importance of the ‘comfort factor.’ She continued, “On both sides, supplier and retailer, if both can give a firm ‘yes’ to whether this is my type of person to engage with and get to know better, on a professional and even personal level, then the foundations are set.”
“Whilst a supplier has to prove their worth from a professional level, a bond has to be made from an early stage. GLTC put faith in Resolution Interiors and it was reciprocated.”
The retailer/supplier relationships that fail are those where value is viewed in a limited capacity and cost is the primary driver.
Pippa Saunders, Resolution Interiors Marketing Manager, commented on this, “The retailer/supplier dynamic works when everyone sees the working relationship as a vertical family.”
“The opposite is when there is a top down structure based on instruction and delivery. When a retailer does not supplement by using a suppliers intellectual planning and direction, a mere commodity is created. Future profit and revenue can be overlooked.”
Pippa highlighted, “The opposite of a collaborative retail/supplier relationship is one where dialogue is restricted and the opportunity for external partnerships are overlooked and silos are effectively created.”
Whilst planning, response, service and knowledge all have roles to play, from the GLTC experience, honesty has been a key factor for the strength of relationship.
“We have all been clear from the very start,” highlighted Claire, “Trusting intellectual opinion with a sense of pragmatism, can go a long way.”
“My advice for any company at an early stage of a supplier relationship is to 1) establish an open dialogue where responsibilities and accountability are clear 2) set both short term and long term agendas. Once the store had opened, GLTC now have flexibility to create a more immersive experience (read our article on brands becoming community hubs) such as children’s parties, book events and a sense of theatre, that all ties back to the brand ethos.”
Looking beyond the top down approach, a foundation based on a partnership dynamic can still become fragmented when there is a change of personnel.
Pippa highlighted, “Whilst trust and honesty are huge momentum builders, when a bond becomes disrupted, problems can occur. From facility manager to operations manager on the retailer side, to the project management and creative teams on the supplier side this is where issues have to be addressed. The answer is a constant consideration for both sides but collaboration partners have to be chosen wisely.”
When working with other brands such as Farrow & Ball and Original Style, collaborating well comes from practices and implementation that compliment each other.
Even to the likes of Nike Boxpark, where Resolution Interiors created a shop within a shipping crate, success is forged from a team who learn together.
“The Farrow & Ball concept store was centred on creating a brand experience that connected with their strategy and personality,” stated Pippa. “Whilst a design looks nice on paper, if it didn’t work on a practical level, then it would be a major issue. Supplier selection has to be based on a broad set of criteria from design to project management.”
When it comes to learning, from a supplier side, educating a retailer to what the problem is becomes a form of guidance. When a retailer looks to solve all their problems internally, it can become a ‘false economy’ according to Claire. “With an internal team that may have limited skill sets around product build, even to furniture, it can become a costly exercise when wrong decisions are made.”
Whist a retailer/supplier collaborative approach looks attractive from the outset, it becomes difficult to implement when trust and honesty is omitted. It takes time and a commitment to work.
Partnerships are driven forward when they are not seen as part of a negotiating exercise. Retailers can take on board an initiative with their supplier counterparts when the whole objective is to create better customer experiences to engage, connect and to feel part of.