Managing supply agreements

In addition to managing consistency and getting what the baker pays for, the whole liability for a recall becomes in focus for many bakeries that are doing business as wholesale co-packers or component manufacturing. Let’s take the example of a pizza crust manufacturer who then sells the skins (crusts) to another food company who then tops, packages and markets their entrée. If there is a problem with the crusts that is a result of a compromised ingredient or replacement that didn’t allow for the nutritional fact panel being in compliance, the pizza crust manufacturer will be liable for the recall unless an agreement passes that liability on to the ingredient supplier. This is becoming much more common and simple record keeping concerning specification sheets, nutritional declarations from suppliers and agreements on notification if the ingredient is in any way in departure from the agreed upon nutritional profile at the point of purchase can go a long way to protecting the baking company’s bottom line and brand integrity.

With regard to price, let suppliers know that you are being pressed to bid out to see how the suppliers can give a purchasing break concerning price tier by volume profiles etc. Remember that the economy affects the suppliers too and they have to compete to keep you as a customer, and share the burden.

Another possibility is on line clearing houses for ingredients where data is stored and certified. This option is becoming more and more beneficial as it becomes more common. This is a way that the baker and the ingredient supplier can have stored agreements tracked chronologically in addition to the certification of the ingredient specifications.

In time of increased price of ingredient and changing ways of marketing baked goods either as retail, wholesale or component, one must become more sophisticated concerning managing the supplies used. Making the ingredient suppliers aware of your specific needs, what is within acceptable variance, what will be rejected, the need for specification sheets with deliveries and ingredient nutritional statements if there is a change, and legally accountable for recalls if you are not notified of a change by them, can not only protect your brand name but minimize daily variances in production that lead to quality, yield and waste increases.

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(0) Comments • Permalink • 08 04 2008

• Dan Ettling, MonkeyMedia Software
• Handshake photo by Andy Roberts

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