The Key Benefits of Digitizing Vendor ComplianceMay 24, 2018
In today’s socially connected world, a whole host of issues at the factory level can turn into a full-blown crisis once customers and other stakeholders take to social media. And if the problem is serious enough, it could damage your business—even if you’re not directly responsible. However, if you properly manage your vendors from day one, issues can often be avoided, or at the very least mitigated, before they turn into nightmare scenarios.
Given the physical distance and differing views on socially acceptable ideals, managing global vendors is one of the most difficult tasks that companies face. But ensuring vendor compliance for Corporate Social Responsibility (CSR) and Good Manufacturing Practices is necessary in order to mitigate risk and protect a company’s brand. These processes are far too intricate and complex to manage through traditional means, in which information is disconnected, siloed and slow-moving. Multiply this across multiple product lines, SKUs and vendors, and the tasks become overwhelming.
Enter digitization. In our last three blog posts, we looked at the key benefits of digitizing your product development, supply chain and quality control processes. This blog post takes a close look at the benefits of digitizing another key supply chain function – vendor compliance.
Digitization eliminates risk
Nearly every retailer and brand sources goods or services from a third party overseas, and there can be a lot of risk involved. Potential risks can be reduced and even eliminated by properly onboarding vendors, establishing Standards and Terms of Engagements, conducting authorizations and assessments, providing training, tracking vendor performance with a Score Card Index and issuing and managing Corrective Action Plans (CAPs) when issues arise.
Digitization can help enforce control and accountability for all suppliers, vendors, and other third parties involved in the design, manufacturing and delivery of your product to ensure compliance, avoid costly litigation, reduce downstream risks and costs of non-compliance, and win market share by building and maintaining a positive public image.
Benefits of digital vendor compliance transformation
There are many benefits of digitizing vendor compliance processes with modern systems. Some of the most common, though, include:
- Centralize vendor information. Digital vendor compliance process allows all vendor information to be stored and managed in a centralized location for quick reference and assistance in vendor profiling when making sourcing decisions. This data is searchable and standardized across vendors.
- Evaluate vendor performance and issue CAPs. By digitizing vendor compliances, apparel brands and retailers can promptly create, issue and manage Corrective Action Plans (CAPs) from anywhere, allowing vendors to continuously improve.
- Manage vendor onboarding. With digital processes, retailers and brands can closely manage all vendors from the onset of the relationship; this begins with the vendor onboarding process. If expectations and procedures are established before any work commences, many issues can be avoided.
- Reduce risk of non-compliance and avoid costly litigation. Digitization helps enforce control and accountability for all suppliers, vendors, and other third parties involved in the design, manufacturing and delivery of your product. This will help ensure compliance, avoid costly litigation, reduce downstream risks and costs of non-compliance, and win market share by building and maintaining a positive public image.
Unlock the benefits of digitization with NGC’s Andromeda Vendor Compliance
NGC’s cloud-based Vendor Compliance solution was designed specifically for the needs of apparel, fashion and footwear brands and retailers.
Vendor Compliance provides a centralized system to evaluate, manage, and report on all the details, simplifying the complexities of compliance management. With real-time data to support decisions, senior management has the information they need to mitigate risk to Corporate Social Responsibility (CSR) initiatives and ensure Good Manufacturing Practices. They can also manage the ever-changing landscape of global Restricted Substances Lists (RSL) and make sure that every vendor is complying.
With the proper tools in place, you can enforce control and accountability for all suppliers, vendors, and other third parties involved in the design, manufacturing and delivery of your product to ensure compliance. This will help protect your customers, the workers who produce your products and your company’s reputation.
Further extend the functionality of your existing solutions systems with NGC’s additional cloud-based solutions for PLM, SCM and quality control. Find more information on Andromeda Vendor Compliance here.
In our next blog, we’ll focus on the benefits of a Digital Supply Chain.