Trust among partners is make or break for retailers and CPG brands at every stage of the supply chain, especially today. With the exponential adoption of omnichannel retail behaviors, customers are prioritizing convenience and demanding transparency into where and when they will get their orders. Unfortunately, delivering on these promises is easier said than done.
Every brand and retailer rely on a curated set of partners, vendors and manufacturers to fulfill orders. Without strategic agreement lifecycle management collaboration between the seller and their behind-the-scenes partners, the fulfillment experience will fall flat, disappointing shoppers.
With automated agreement lifecycle management, partner negotiations are simplified and optimized. This makes it easier to get in touch with partners for quick negotiation, but it also improves efficiency by creating a single source of truth. This allows retailers and suppliers to exchange all agreements through a common, up-to-date platform. Additionally, by removing manual processes like data exchanges and contract reviews that can lead to errors, automated lifecycle management mitigates miscommunication and save valuable time and resources.
So how can retailers and CPG brands ensure successful collaboration to boost profits, protect margins and adapt to the digital landscape? By using the following best practices to create an ecosystem based on trust and ongoing communication.
Transparency should be incorporated into every stage of the agreement lifecycle including the initial negotiation. All documents used in this phase should be accessible to every party at all times. Once the partnership is established, cloud-based simulations can help them discover shared goals and overcome hurdles. These in-depth scenario tests can help all partners anticipate potential problems and discover solutions that fit within the agreement long before any issues affect profits.
And with increased transparency into the supply chain, retailers can provide accurate insights to their loyal customers. For example, if the partner is able to foresee potential issues, the seller can then give the customer realistic product selections based on production capabilities, real-time stocking updates, accurate shipping and delivery notifications, fewer cancelled orders and consistent pricing.
Incorporate Points of Differentiation
After partners have opened the lines of communication, they should collaborate on shared goals. In today’s crowded retail landscape where new digital brands are popping up faster than ever, notable points of differentiation are required for success.
If the retailer’s value proposition includes faster shipping than competitors or a guaranteed lowest price, they must focus their efforts on efficiently managing the agreement lifecycle. Flexible agreements are made possible by open communication between partners, giving brands and retailers the opportunity to deliver on customer promises by working with partners to renegotiate deals, not against.
Partnerships devoted to creating the best customer experience and enhancing the value proposition will improve the bottom line for all parties.
Provide for Customers with Price Sensitives
According to Deloitte, 76% of U.S. consumers are concerned about the price of everyday items rising over the coming months. As a result, they’re increasingly comparison shopping. With price as a top deciding factor for many customers, retailers and CPG brands will benefit from understanding the price sensitivities of their target audience.
Having real-time flexibility in partner agreements is critical to providing the best price for customers and earning their business. Partners that calculate their margins based on ideal pricing and other logistic conditions on an ongoing basis and adjust their agreements accordingly will achieve higher profitability.
Achieve Goals with Precise Partnerships
By properly managing agreements with digital agreement lifecycle management, retailers and CPG brands become more flexible and can easily identify shared goals with partners. With an eye on the prize and the collaboration needed to achieve it, retailers and their partners will increase profits and improve the customer experience.
Stefan Hilger is a member of the executive board of gicom