According to a recent survey by Advantage Group International measuring supplier and retailer engagement performance, 73 percent of U.S. retailers improved their supplier relationships in 2020.
The annual Advantage Report, which surveyed more than 190 American retailers, found the disparity is widening between those suppliers that are viewed as best in class and the rest of the pack.
The top five ranked suppliers have consistently made gains in retailer perceptions between 2017 to 2020 but overall, the U.S. supplier industry has slipped in performance assessment over the same four-year period. Understanding each other’s strategy is a key contributor to high perception scores, according to the Advantage Report findings, with top suppliers rating 42 percent higher and top retailers rating 127 percent higher than the pack on that dimension, with their respective partners.
Low satisfaction of supplier relationship performance points to a weak assessment of supply chain practices that are contributing to the struggles many suppliers have in adapting to omnichannel demands. According to the study, the five most under-performing competencies for U.S. suppliers in 2020 were delivering complete orders; aligning on supply chain metrics; driving supply chain efficiencies; on-time delivery; and packaging for e-commerce.
The battles within the supply chain today represent a critical opportunity gap for suppliers to differentiate themselves from their competition by focusing on improving and advancing their retail partner’s omnichannel agenda.
“While 2020 made it harder for suppliers to keep their supply chain at the same level, those who stood out were able to navigate the supply chain pain points more seamlessly with their customers due to their strength and simultaneous focus on the behavioral competencies,” said Annaliese Jagusch, chief customer officer for Advantage Group International. “We found that industry leaders continue to prioritize communication skills, responsiveness, proactiveness and attention to building trust, improving supply chain engagement and bringing more consideration, empathy and flexibility to short-term obstacles.”
