Recently, GreenSeed received a substantial order for beef and chicken bone broth. The mineral-rich power food is a mainstay for many families during the pandemic (along with new hand washing rules and more Monopoly nights!).
We met demand, in large part, because of our value chain.
But what does that really mean? To level set the topic, Michael Porter’s “Competitive Advantage: Creating and Sustaining Superior Performance“ introduced the value chain in 1985. Porter suggested assessing the value of each activity necessary in getting a product to market. The sum total then becomes one ginormous competitive advantage. We believe.
To us, a value chain begins with an “everyone matters” culture. Among contract packagers, this clashes with the traditional commodity-driven stereotype. But that’s the rub. A value chain chooses relational over transactional thinking.
The outcomes are extraordinary: suppliers go above and beyond, mutual respect and ideation lead to greater innovation, and an elevated consumer experience builds CPG trust and brand loyalty.
The consumer is a key player in the value chain. For them, the value chain delivers high integrity flexible packaging, consistent brand colors, sturdy boxes, on-time delivery, and healthy ingredients they trust. All this becomes, as Porter suggests, a competitive advantage for CPGs.
Theory is great until it leaps off the page. So how do you actually evolve a supply chain into a value chain? We don’t have a playbook. However, we believe so passionately that the value chain is a difference-maker — especially in this time of great disruption — we’re sharing six lessons we’ve learned.
Asking critical questions creates remarkable dialogue.
Suffice it to say, our communication with suppliers and customers has increased tenfold since the pandemic hit. There have been many more emails and video conference calls (relatively new for us) to find out what is on everyone’s plates.
Here’s what we’re asking: Will they have trucks to deliver the food and supplies? What challenges do they have for inbound logistics? What new demands are they struggling with? Do they have emergency orders or urgent requests? Are they restocking specific products? Is there a way to get products to distribution centers faster?
John Wooden had it right.
Former UCLA coach John Wooden won games. He did this, many say, because he knew each player’s strengths and where on the court they could shoot best. “Teamwork is not a preference; it’s a requirement,” he said. As a contract packager, our customers supply the food, the boxes, the rolls of film and other materials. Everyone has a strength. We work on the backend to recognize and optimize those strengths.
Silos within organizations are risky. You could write a book on why they happen, but a value chain is more agile and transparent. For example, we normally have one person who reaches out to a customer regarding rolling forecasts and needs. In the current climate, we’re finding customers have a variety of organizational priorities so our infrastructure has adapted with multiple people reaching out to different levels. To put it simply, stepping on toes is a nonissue when silo thinking doesn’t exist.
Aligning your values with the values of your suppliers inspires commitment.
If I know your story and what you stand for, I’m much more likely to support you. Getting to know the values of your suppliers is one of the best ways to nurture a value chain. How do they inspire and take care of their team? How do they follow through on promises? In what ways are they socially responsible? What are their core values?
The power of gratitude and transparency.
A decade after Porter’s book, the USDA report “Food Value Chains: Creating Shared Value to Enhance Marketing Success” stated that, “Central to the notion of food value chains is the idea that transparent and trusting relationships between supply chain partners can produce positive, win-win outcomes for all parties.”
A lot of good comes from trusted relationships. Thanking our supplier partners, encouraging them and inviting them to explore ideas with us keeps morale and innovation high during a difficult time. Equally important, we’re recognizing what is being asked of the people on the plant floor and to infuse positivity throughout our company and the value chain.
Remembering your “why” is, well, everything.
First and foremost, we are a conduit to getting healthy food to, not faceless consumers, but real people with real lives. Our work helps people grow in many different ways within GreenSeed and the value chain. This is our why and it plays a critical role in how we work with others.
The consumer story is always in flux. Buying behaviors change for many reasons — now more than ever. As their lives change so do ours and those in our value chain. It feels good to lean on suppliers we trust and who we know — without question — are there for us and our customers.
Back to good food. Borrowing the words of author Lemony Snicket: “The dumplings had the flavor of paradise, and the broth spread through my veins like a secret that’s fun to keep.” A value chain moves product to the consumer, adding value to a person’s life. It grows companies in the value chain in positive, enduring ways and creates a poignant feeling of accomplishment as memorable and comforting as, you guessed it, a steaming bowl of broth.
GreenSeed Contract Packaging supports CPG growth with customized, flexible packaging operations in the dry foods category. We believe in the brands we manage and their natural healthy products and rally for sustainability by exploring packaging innovation, including protecting our waters from excess debris and destruction and leaving the earth better than we found it. Visit our website.