Efficient and timely delivery is essential for the FMCG (Fast-moving consumer goods) industry. This can be achieved by building strong relationships with suppliers, embracing technology, implementing efficient inventory management, improving transportation and logistics, and ensuring supply chain visibility.
These strategies will allow you to reduce costs, improve customer satisfaction, and gain a competitive edge in the industry.
Invest in a Contract Management Software
Contract management in FMCG businesses is a challenging process. Inaccurate, outdated, and incomplete contracts lead to legal disputes, missed sales opportunities, and wasted hours on negotiating the same contract provisions (that are by definition non-negotiable).
To ensure proper and effective contracts, businesses should invest in a contract management software that will streamline processes, minimize errors, and eliminate redundant tasks. A good CLM platform allows teams to create contracts faster by importing accurate data, leveraging pre-built templates, and allowing for easy editing. It also enables contract signatures and provides analytical insights to boost efficiency.
Choosing the right solution varies by business size and specific needs. Larger enterprises need a customizable solution that can adapt to future demands, while smaller companies may be better off with an off-the-shelf product. Considering all costs including implementation, training, support, upgrades, and integrations will help in making the right decision.
Collaborate with Suppliers
Supplier collaboration is a top priority for many consumer goods companies. In fact, 87% of suppliers surveyed in a recent RELEX survey said they wanted more collaboration with their retail and wholesale customers. But despite this desire for increased collaboration, the current state of supplier relationships leaves a lot to be desired, with important data remaining siloed and communication limited.
Effective collaboration requires strong, open communication. It also requires fostering supplier-enabled innovation, where the company encourages the supplier to innovate within its materials or create complimentary products. This can save significant costs over the long term.
It’s also important to make supplier diversity a business priority and seek out minority-owned or women-owned businesses. This can help build supplier resilience and support local economic development. It can also increase the overall quality of products and services, reduce costs, and improve supply chain resiliency.
Automate Your Processes
One of the best ways to improve efficiency in your business is by automating your processes. When manual processes are automated, they can run on their own without any human intervention and with a much higher level of consistency and accuracy than when a human is involved. Automating your processes can also free up employee time to focus on other more important tasks and projects.
The FMCG industry, inclusive of entities relating to it, or an extension of it, like an FMCG consulting firm, is highly competitive, and it’s important to keep a close eye on your supply chain to ensure that you can deliver products quickly and efficiently. This requires collaboration between stakeholders and the use of technology to streamline operations and reduce inefficiencies.
Effective supply chain management includes demand forecasting, inventory management, and logistics. It also involves reducing food waste by implementing sustainable practices, educating consumers, and using innovative packaging technologies. In addition, leveraging technology to optimize supply chain logistics can help to reduce transportation costs and delivery times.
Automate Contract Signing
It’s common for contract management to get messy without clear processes. Drafts pile up, old versions sneak back in, and it’s almost impossible to keep everyone aligned with the most recent version. This can result in inconsistent terms, misunderstandings, and legal vulnerabilities.
With contract automation, standardized templates and auto-populated fields eliminate these risks. These tools can use AI to quickly analyze contracts and extract relevant details such as payment terms, renewal dates, confidentiality clauses, and more. This information can then be inserted into new documents and sent out for signatures.
Automating these contract-related processes saves employees time and energy so they can focus on more valuable projects. It also helps improve overall labor productivity and reduces the likelihood of human error. This helps ensure smoother contract signing experiences for your FMCG counterparties. This is key for building trust and strengthening business relationships. Ultimately, it’s about making solid decisions on the basis of reliable data.
Automate Change Management
As any procurement leader knows, the process of selecting and establishing vendor contracts involves a lot more than just an exchange of goods. Strategic sourcing teams must conduct thorough evaluations to find the right partners and enter into negotiations around product offerings, contract length, payment terms, renewal options, and more.
When it comes to managing these contracts, a powerful CLM software platform equipped with centralized contract repository features and graphical dashboards can help streamline processes and reduce cycle times. A streamlined process also ensures consistency, reducing the risk of misalignments and mistakes that can halt or even shut down automated operations.
To prevent these problems from occurring, it’s important to have a change management strategy in place. This can involve ensuring that senior-level leaders serve as project sponsors to remove obstacles, providing training and support for employees during the transition, and monitoring KPIs like handling time and number of exceptions. It can also be about having a plan for handling disputes and communicating with stakeholders throughout the process.
Automate Contract Approval
When contracts are managed manually, it’s easy to misinterpret terms or overlook a clause. With an automated contract management system, every change is logged and documented for full transparency and compliance.
Automated contract templates, pre-approved language, and approval thresholds mitigate risks by standardizing processes and improving collaboration. They also help avoid ambiguous or misleading clauses, reduce dispute risks, and speed up contract execution.
Contract automation saves time and energy for legal teams by facilitating self-serve contracts for business users. It also helps ensure that everyone is working from a single source of truth and the most current contract version. Moreover, with customizable reporting, it’s easier to make informed decisions using data and analytics, rather than anecdotal information.
Automate Contract Monitoring
Contract monitoring is a time-consuming process that involves tracking the performance of all contracts from drafting to execution and renewal. It is important to automate contract monitoring because it eliminates human error, which can lead to missed deadlines, compliance issues, and financial instability.
Contract automation can also speed up the process by eliminating tedious manual work like sifting through file cabinets and navigating email threads in search of a specific contract version. Furthermore, it can help you stay on top of contract renewals and milestones with automated reminders and alerts.
Lastly, it can make contract management more transparent for everyone involved in the process. With a centralized contract repository, it’s easy for departments and legal teams to see the status of contracts in real-time. For example, a tool like Jotform Sign makes all contracts visible in the same inbox, allowing departments to check their status without having to ask the legal team for updates.
Automate Contract Enforcement
Contract management automation tools streamline the process of generating and signing contracts, e-signatures, and related documentation. This significantly reduces the time it takes to manage these processes, and helps you avoid costly mistakes like misplaced documents or unauthorized changes to contract terms.
Automated templates make document generation and e-signature easy, while enabling customization for each contract. Moreover, contract automation tools support data entry by extracting metadata and automatically populating relevant fields in the autogenerated contracts and associated files. This ensures that all stakeholders are using the same version of the contract, thus eliminating confusion and reducing the risks of compliance violations.
Contract management software also provides alerts for upcoming contract milestones, such as renewals and expiration dates. This enables legal teams to take proactive measures to meet contract obligations and mitigate the risk of lost sales opportunities and legal disputes. In addition, centralized contracts provide a clear audit trail of all changes, approvals, and revisions.
Automate Contract Lifecycle
Contract management can be a long and cumbersome process without the support of an automation tool. Managing contracts manually can result in a lot of confusion and miscommunication amongst teams and a lack of compliance with legal and industry standards.
Using a contract lifecycle management (CLM) tool, businesses can automate processes and create standardized templates that adhere to internal and external policies. This allows for quicker and more efficient reviews and approvals. It also prevents mistakes and enables faster turnaround times for a smoother business process.
The ability to manage contracts systematically helps companies avoid last-minute rushes and potential contract lapses. By automating reminders and alerts, businesses can stay on top of upcoming contract renewals and expirations. With this streamlined contract process, it is easier to focus on driving more business with customers. A centralized repository and detailed reporting also help to reduce risks and promote compliance with legal requirements and industry standards.