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American Food & Ag Exporter

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Primary And Secondary Suppliers

Jim Prevor’s Perishable Pundit, October 4, 2006

One of the lessons of the spinach/E. coli situation is that buyers need to dig a lot deeper in selecting primary and secondary suppliers.

Most buyers of size don’t want to be 100% in the pocket of any one supplier. Reasons are many, but include making sure that the buyer has an established business relationship to turn to for product if one supplier gets hit with a food safety scare or its production is otherwise interrupted.

The enormous variety of brands packaged by Natural Selection Foods revealed that many buyers who thought that they had a secondary supplier really did not.

A food safety crisis, a fire, a terrorist act — anything that had closed down the Natural Selection Foods processing facilities would have interrupted supplies, at least temporarily.

Indeed there isn’t even a guarantee that companies buying bulk product from Natural Selection and packing it would have been able to secure alternative supplies if Natural Selection Foods couldn’t produce.

So retailers, foodservice operators, wholesalers, exporters — any buyer who wants both a primary and secondary vendor needs to add a new representation and warranty to its packet — that the two vendors selected each agree not to co-pack at each other’s facilities or supply each other with raw material.

It is the only way for a buyer to actually achieve what it hopes to achieve through having multiple vendors.

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