Using supplier relationships to serve customers better
A Marks and Spencer case study

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Page 3: Integration of the supply chain

Marks And Spencer 4 Image 4The common objectives for Marks & Spencer and its suppliers are to:

  • increase sales
  • minimise stocks
  • minimise commitment
  • maximise flexibility.

The key to doing this has been to manage, or integrate, the supply chain so that both Marks & Spencer and its suppliers are working towards the same business objectives. Communication is therefore important between all parts of the chain to ensure that the differences between demand from customers and the suppliers’ ability to meet such demand can be minimised.

Developing supplier relationships

Marks And Spencer 4 Diagram 1Marks & Spencer’s ability to respond quickly to changing customer needs lies with mutually advantageous relationships developed with suppliers throughout the supply chain. Many of the suppliers have seen their businesses grow alongside that of Marks & Spencer. The strength of these relationships and the mutual trust and support each provides is a critical element for the development of each business.

An important element in managing this supply chain is ‘fairness’. Working closely with a limited number of suppliers involves helping each of them to meet their own business aspirations, but not at the expense of other key suppliers. The starting point for managing the supply chain is to coordinate Marks & Spencer’s business strategy with each of the suppliers’ business plans. This will provide the structure and direction for each supplier to follow.

Marks & Spencer’s strategic objectives are to develop all new products so that they:

  • fully satisfy the customer in terms of comfort and fit
  • are available at the required time
  • are clearly specified so that they can be launched into any manufacturing site
  • provide the maximum benefits permitted by each design.

The beginning of season strategy meeting provides suppliers with the opportunity to discuss their expectations with Marks & Spencer, such as the areas of business they would like to grow. It also enables Marks & Spencer’s decision-makers to provide suppliers with a realistic assessment of where they need to develop. Discussions at this stage may broach issues such as how to encourage others to take their products further forward and how to spread knowledge.

At the heart of this process is integrity. It is important that all parties are dealt with in a fair and equitable way which sustains relationships to provide long-term business opportunities and developments.

Supplier strategy

Marks And Spencer 4 Image 1For many lingerie suppliers, Marks & Spencer is often their main customer. These relationships are interdependent - Marks & Spencer depends on the capabilities of its suppliers to help meet customer requirements. If Marks & Spencer is successful in meeting the needs of its customers, then the suppliers will also reap the benefits and rewards.

Planning a business strategy with suppliers helps to provide a clearer brief for all parties involved in the process of supply. Interim meetings provide a useful opportunity for suppliers to provide feedback from trade fairs and discuss trend predictions. Much of the information provided for these meetings is market-driven. Working with suppliers enables Marks & Spencer to combine its own experience with that of suppliers to identify new product ranges which will fit in well with other existing product ranges.

Meetings with suppliers help to provide a clear structure for the range of products at an early stage. They also identify key issues, e.g. which fabrics to use, technical priorities and establishing the number of products which will be bought for that season. It is important that potential problems are foreseen and solved. More detailed meetings earlier mean less crisis management later.

Meetings also involve discussions on the development of the previous season’s products so that priorities can be established for the forthcoming year. This might include:

  • sales patterns
  • trends in the market and fashions
  • colour palette and theme boards
  • yarns, fabrics, trims and components
  • the general shape, fit and direction of the range.

Marks and Spencer | Using supplier relationships to serve customers better