One study showed 94 percent of consumers said they’d be more loyal to brands that offer supply chain transparency.
Restaurant operators have a lot to worry about. First, they must ensure that all the different food products coming into their restaurant have been grown, processed, and transported with safety and quality top-of-mind. In addition, operators must be certain that the products they’re buying (and serving) have had positive environmental and social impacts, including fair labor practices, animal welfare, and sustainability at every point along the supply chain.
Today’s consumers have become more focused on where their food is coming from.
They want it to be safe, of course, but they also want to know about how it’s been sourced, the products’ environmental impact, if the animals are being treated humanely, and whether the products’ packaging is eco-friendly. In fact, 94 percent of consumers said they’d be more loyal to brands that offer supply chain transparency.
As a result, many restaurant brands are emphasizing supply chain transparency, which lets them identify and mitigate risks, strengthen their supplier partnerships, boost communication with suppliers, and better protect their guests, reputation, and bottom line.
Improving supply chain transparency will help restaurants and other food brands:
- Identify and mitigate risk. A transportation delay can cause perishable foods to rot on hot trucks or in warehouses. Climate change—including extreme heat, more frequent storms, and extensive flooding—can contribute to more bacterial growth and migration, raising the risks of foodborne illnesses. A safety breach— such as sewage or chemicals seeping into a nearby farm—can contaminate crops. Greater supply chain visibility means that restaurant brands can identify and mitigate any potential risks.
- Boost ESG initiatives. Increasingly, restaurants are prioritizing environmental, social, and governance (ESG) initiatives. That means more restaurants are reducing their environmental impact, prioritizing sustainability, committing to diversity, equity, and inclusion (DEI) efforts, and buying responsibly sourced products. As part of their efforts, restaurants are examining their supply chains, opting to work with suppliers whose ESG values align with their own. To boost transparency through every step of their supply chains and determine whether their suppliers are properly certified—in terms of both safety protocols and ESG efforts—they need to better manage their suppliers’ certification status. Use tech tools to organize, track, and manage supplier certifications. That way, you can be sure you’re only working with suppliers that prioritize safety, quality, transparency, and compliance. This effort will help make your supply chain safer, as well as greener and cleaner.
- Improve supplier performance and resiliency. Digital solutions help organizations get accurate real-time data and feedback so they can take action to improve their operations, solve problems, boost safety and quality, increase accuracy, and reduce costs. Supply chain transparency creates resilient operations by providing valuable real-time data to stakeholders. Having a clear view of inventory, potential disruptors, and activity all along the supply chain allows companies to be more agile, flexible, responsive, and resilient.
- Increase sales, profits, and loyalty. Customer retention and loyalty is essential to a brand’s profitability. It costs five to seven times as much to attract a new customer than to keep an existing one, and a 5 percent customer retention rate can increase profits by 25-95 percent. As more consumers gravitate towards brands that operate safely and ethically, sharing information about your supply chain can help you increase trust, loyalty, and sales. Supply chain transparency can improve a company’s reputation, as well as increase its productivity, reduce operational cost, and increase profits 2 percent to 10 percent.
- Make smarter, data-driven decisions. Tech solutions with real-time capabilities can gather data in one place for a single source of truth, and provide analytics that help brand leaders make smarter, more informed decisions. Armed with this critical knowledge, brands can reduce risks, solve problems, eliminate waste, anticipate disruptions, implement positive changes, maximize performance, and optimize operations.
- Boost communications with suppliers. Supply chain issues and disruptions occur for a variety of reasons. Supply chains have been significantly impacted from the COVID pandemic and are still struggling to regain pre-pandemic functionality. But a drought in the Midwest can disrupt the availability of certain produce and/or cause prices to spike. A transportation delay can put food safety at risk if perishable products are being held on hot trucks. Therefore, ongoing communication with your suppliers is essential. It’s important for restaurants to be aligned with their manufacturers and suppliers, all working collaboratively to boost safety, quality, and transparency. Tech tools—like the cloud, quality management software, artificial intelligence, etc.—are revolutionizing restaurant brands’ ability to communicate with suppliers and elevate safety protocols all along the supply chain.
- Improve the whole industry—not just your restaurant. The benefits of supply chain transparency can extend across your industry. When your brand—and your suppliers—provide proof of quality and integrity, you gain a competitive advantage. Whether you’re working to offer sustainably raised meat or increase eco-friendly packaging, your commitment to these issues can help drive industry change.
Today, consumers aren’t just looking to buy a meal. They want to know as much information about their food as possible, including where it comes from, how it was grown or raised, whether the suppliers treat their employees—and their animals—fairly and compassionately, the environmental impact of the companies you work with, and whether your brand (and your suppliers) support ESG efforts. The best way to address these concerns—and increase sales, customer loyalty, and other key metrics—is by embracing transparency all along your supply chain.
Paul Damaren is Executive Vice President, Business Development at RizePoint, a technology leader in the food safety, quality management, compliance, and social responsibility space. RizePoint’s quality management software solutions help companies, including Starbucks, McDonald’s, Marriott, and more, keep brand promises through their quality, safety, and compliance efforts. Customers gather better data, see necessary actions earlier, and act faster to correct issues before they become costly liabilities. Check out RizePoint’s new website to learn how these solutions can help your company.