Supplier Approval SOP in the Food Industry

Which bad experiences will our Supplier Approval SOP help to stop?

• Current supplier approval processes are complex and manual. Often completed manually on spreadsheets which are also used for risk assessment can often result in a standard operation procedure that is reliant on knowledge in key users’ heads.

• Supplier approval management has been added into a specification system and you have to capture supplier questionnaires and certificates manually and then attach to the specification system resulting in a duplication of work.

• Audits are a source of stress and you worry that non-conformances will be identified in supplier approval management audits. Supplier performance may be tracked manually and there is not a robust view on supplier risk. With a large supply chain there may not be robust, unquestionable data to differentiate good suppliers from suppliers that present a food safety risk.

• It is very time consuming getting self audit questionnaires completed by suppliers. Supplier auditing is an ad-hoc process and the decisions on how to approve suppliers for raw materials are being made subjectively.

• Self audit questionnaires submitted by some suppliers are not completed satisfactorily.

• Management of expiring 3rd party audit certificates is labour intensive and error prone resulting in more risk of audit non-conformances. You are never certain your approved supplier list is up to date and used by all purchasing managers.

What does our new Supplier Approval Process involve?

Our robust supplier approval SOP involves a number of key stages.

Robust Risk Assessments are the foundation of the entire food safety management system, including supplier approval. There are many challenges faced by food businesses in conducting robust risk assessments.

• Person completing the risk assessment does not have the correct data, or enough data.
• There can be mixed messages from customers, auditors and colleagues on the best approach to use to select suppliers.
• The time required to collect the necessary data may not be available or suppliers may not be supportive.
• It is difficult tracking everything.
• How deep do we dig when completing risk assessments. There can be a tendency in some businesses not to dig too deeply taking the view that it is better not to know about the risks within a supply chain.
• Not sure of best practice. Other than some retailer codes of practice there are few industry best practice guides on how to complete a risk assessment. One of the better recent examples was published by CampdenBRI, Risk evaluation and management of raw materials (Second edition) 2019 (Campden BRI)
• How to define risk levels. This is an area that often has too much subjectivity.
• Many risk assessments are inconsistent or contain confirmation bias.
• Many businesses have duplication within their risk assessment processes often as a result of standalone food safety, ethical and sustainability assessments being completed by different teams.

This provides a robust risk assessment which outputs a supplier approval methodology, often one or more of, a 3rd party audit, a supplier self audit questionnaire and/or a supplier audit.

3rd party audit is where a decision is made to approve a supplier based on them having a current 3rd party audit often completed against GFSI benchmarked audits such as the BRCGS. Traditionally many businesses complete this step manually using email but now over 16,000 progressive businesses now use QADEX to automate this process.

Self Audit Questionnaires (SAQ) is where the food business has a standard self audit questionnaire which is sent to the supplier to complete and return for review by an experienced supplier approval manager. Traditionally many businesses complete this step manually using Word or Excel but over 16,000 progressive businesses now use QADEX to automate this process.

Supplier Audit is where the food and drink business sends an auditor (employed or subcontracted) to audit the supplier against their own standard and requirements. Whilst this is the most time consuming and expensive process it is the most comprehensive as an experienced auditor will pick up on issues that are overlooked by 3rd party audits and/or self audit questionnaires.

Once the above stages are completed a decision can be made to approve a supplier, not approve a supplier, or approve a supplier with conditions. A progressive supplier approval SOP will then proceed to a quality assurance or supplier performance monitoring phase.

QADEX supplier approval SOP software automates the supplier performance monitoring phase and creates supplier performance benchmarks and trending dashboards which provide early warnings where a suppliers performance may be deteriorating.

How does the procedure in the Food industry differ from other industries?

The key differences between a supplier approval procedure in the food industry and most other industries are:

• The consumer is ingesting the product produced by the food industry and the ability to harm a consumer is therefore often much higher than other industries.
• Consumers rely on the food that the consume to provide sustenance and nutrition.
• Certain ingredients within foodstuffs can provoke an allergic reaction which kills consumers.
• Consumers and society have an emotional connection to food.
• Many consumers have dietary preferences closely associated to their religious belief.
• Some consumers are at elevated risk when consuming food, examples include infants, allergic consumers, elderly and sick consumers.

As a result of these differences the process of supplier approval of food is highly complex and compounded by the fact that many foodstuffs are manufactured with ingredients of animal/fish origin or grown in fields where it can be very difficult to remove all risk to the end consumer.

What does a Supplier Approval SOP involve?

• Risk assessment of suppliers.
• Gather and analyse extensive data to assess a suppliers capabilities.
• Physically audit high risk suppliers to a defined frequency.
• Maintain an approved supplier list and only source raw materials from this approved supplier list.
• Maintain a quality assurance sampling program to monitor raw materials.
• Monitor supplier performance continuously.
• Repeat the above cycle continuously.
• Constantly challenge your process to ensure it is adding value and not just a tick box exercise.

Challenges with COVID-19 associated with this process

There are a number of challenges Covid-19 has introduced:

• It may not be possible to physically audit a supplier and remote audits may be required.
• Businesses running manual processes have struggled to continue the processes seamlessly during lock down where key staff are working from home.
• Supply chain disruption introduces new risks not previously considered.
• Approved supplier list suppliers unable to supply resulting in the need to approve new suppliers quickly.