Building a transparent supply chain

A transparent supply chain is good for a brand’s identity as well as its bottom line. How can you build one yourself?

Consumers increasingly feel empowered to call out cynical marketing ploys, including greenwashing and ‘wokewashing’. In response, more small businesses are embedding supply chain transparency as a pillar of their models. Not only does this enhance a brand’s position on sustainability and open up communication with its consumer base – transparent supply chains can also be profitable.

Lucy Flinter is the director of Zero Procure, a procurement company launched in the pandemic. As well as housing a network of suppliers, Zero Procure also supports communications and marketing for launches of new supply chains. ‘Some of the big trends we are seeing are hyper-localisation and the focus of provenance – researchers at MIT noted that consumers could be willing to pay between 2% and 10% more for products that have greater supply chain transparency,’ says Lucy.

While there is a push from consumers, there is also a fundamental pull factor for companies. ‘Transparent supply chains reduce reputational risk and enhance a company’s standing,’ Lucy continues. ‘It also helps in attracting and retaining talent who are keen to work for responsible companies.’

In comparison to global companies, small businesses are much better positioned to source and build transparent supply chains. ‘Small businesses are often agile and able to flex their purchasing models. The first step is for companies to undertake an audit to ascertain their current practices, looking for any areas of concern. They should then look for opportunities for improvement, filling information gaps and setting key performance indicators.’

The meat industry, for example, is constantly under fire for its supply chains. Glen Burrows and Farshad Kazemian are the founders of The Ethical Butcher, a marketplace for meat that has been reared on regenerative farms around the UK.

‘Like third-wave coffee and craft alcohol, people are starting to geek out about the terroir of their meat,’ says Glen. ‘But we were finding that even butchers didn’t know where their meat had come from, or whether it had been grass-fed or grain-fed.’ (The latter does much more damage to the environment.)

Outside of traditional butchers, the only other distribution channel for these regenerative farms were major supermarkets, which didn’t know the quality of the meat they were getting. ‘They were selling a product that should have been priced three times higher because of its quality.’

The Ethical Butcher is both a new distribution channel for these farmers, as well as a means of improving supply chain awareness across the industry. Each batch is tagged with a QR code that is unique to the farm that the meat has come from. In a previous life, Glen was a photographer, a skill that he thinks is vital to the resurgence of supply chains. ‘Any modern online business today is a publishing company,’ he says, referring to the farm stories that he shoots. ‘Something about these films has resonated so much that some consumers will ask for meat specifically from a certain farm.’

As supply chain management becomes more and more digitised, here are some tools that are specific to different industries that will help you to build your own:

For food and drink: Smallholdr is a data-driven, cloud-based mobile and web app that manages field farmers and predicts yield, with a specialist focus on farmers in Sub-Saharan Africa. Features include a work planning tool, QR code traceability and location-based trends.

For consumer products: Provenance uses blockchain and open data technology to bring the stories of supply chains to consumers. By combining the technology with smart communications and marketing strategies, the Provenance team partners with companies to enable a transparency-centric transformation in engagement.

For minerals, luxury goods, art and wine: Everledger creates a permanent, digital record – otherwise known as an ‘intelligent label’ – for a variety of valuable assets. Using blockchain, artificial intelligence and Internet-of-Things tech, Everledger is able to drive environmental sustainability and ethical behaviour across sourcing operations.

This article was first published in Courier Issue 38, December/January 2021. To purchase the issue or become a subscriber, head to our webshop.

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