I am a very frustrated buyer and I am quite sure that I am not alone. Here at Hancocks Cash and Carry we have five buyers dedicated to purchasing the 5,000 confectionery products that we sell in our 16 depots. We talk to suppliers on a daily basis and work very closely with them. We give them accurate forecasts many weeks in advance, especially with regard to special offers. Yet still we are let down on a daily basis when it comes to delivery.
Now I know this is an industry-wide problem and concerns both large and small confectionery manufacturers, but that doesn’t make it any better for me.
Our level of availability currently runs in the low 90% region, whereas our target as a company would be 98.5%. Now 90%-plus might be pretty good as the industry goes, but we have higher standards than this and so do our customers.
This situation directly affects the image and reputation that we maintain with our target audience, as our customers see poor availability as the fault of Hancocks. They understandably don’t want to hear how a particular supplier has let us down; they just want the goods. Being a confectionery cash and carry with a huge range, we can usually find them a good alternative, but that is not really the point.
We often find that we are the ones telling the suppliers that they have failed on a delivery, due to our efficient daily reporting process. Surely they should be the ones telling us. And some of the reasons that Hancocks are given when a delivery does not arrive are quite comical. For example, the supplier has run out of lorries, the stock was in the wrong place or, worse still, they have run out of labels for the product.
And while we can all have a bit of a laugh at some of these excuses, the simple issue is that no single person is taking responsibility for the problem at any single organisation. Quite often the MD is not aware of the supply problem and neither sales nor logistics nor production want to enlighten him of this fact.
Much of this problem comes down to cost-cutting - cost-cutting in terms of trained staff to manage the ordering process, which is all too often left to computerised systems with few people available to check the accuracy of the process.
It is also cost-cutting in terms of stock levels. As stock costs money, the finance department would rather see as little of it as
possible being held for any length of time. The result of cost-cutting is bad planning and a total lack of accountability.
But it is a downward spiral and the situation continues to get worse. Cost-cutting in these ways is resulting in stock shortages and therefore significant lost sales to the independent market, which we, as a company, are striving to develop.
And, of course, a cost can be attached to the time spent by all concerned chasing deliveries, communicating problems and re-ordering supplies.
And we at Hancocks can attach yet another cost to the holding of a higher level of stock ourselves in order to try to minimise shortages to our customers.
So wouldn’t it be better for all suppliers to hold just a little bit more stock and organise just a little bit more training so that sales grow and we all help each other to develop?
So what can be done to try to improve availability of confectionery? I believe the first step has to be that each manufacturer makes a single person responsible for availability. And that person has to sit outside sales, production and logistics.
Also, commitment to make things better has to be evident from the top down. Suppliers have to stop accepting this situation as the norm and realise the true benefits of delivering exactly what is ordered a much higher percentage of the time. Hancocks will help any of its suppliers to turn this situation around. We perform well in the independent market but its true potential is yet to be seen. Give us the stock and we’ll do the rest.