The Groceries Code Adjudicator (GCA) plays a crucial role in maintaining fair and lawful standards between suppliers and large retailers in the UK. Established to oversee and enforce the Groceries Supply Code of Practice (GSCOP), the GCA ensures that the 14 largest retailers adhere to the Code, which governs their interactions with suppliers. Every year, the GCA conducts an extensive survey to gather confidential feedback from suppliers about their experiences. This survey, managed by the independent polling company YouGov, is a vital tool for understanding supplier-retailer dynamics, including compliance with the Code, cost price negotiations, and other pressing issues.
The insights from the GCA’s 2024 survey reveal persistent and evolving challenges in the retail sector, such as delayed payments, inadequate forecasting, and high operational costs due to disputes. As we delve into the survey’s key findings, it becomes evident how PRGX Supplier Connect can address these challenges, streamline supplier-retailer interactions, and improve these valuable relationships for the long haul. And while numbers have improved slightly, UK retailers can benefit tremendously from a comprehensive solution that streamlines dispute management.
Key Findings from the GCA Survey
https://www.gov.uk/government/news/improved-treatment-of-grocery-suppliers-despite-poor-amazon-performance
The GCA’s annual survey provides a comprehensive view of the issues suppliers encounter with retailers, categorized by Code provisions.
Delayed Payments: 6% of suppliers reported experiencing delays in payments, reflecting a significant disruption in cash flow and operational efficiency
Forecasting Errors: 9% of suppliers noted a lack of compensation for forecasting errors, which can lead to misaligned production schedules and financial losses
Marketing Costs: 10% of suppliers faced obligations to contribute to marketing costs, often without clear agreements on returns or benefits
Contract Variations: 14% of suppliers highlighted issues with variations in supply agreements and terms, typically enacted without reasonable notice
These issues are compounded by inadequate processes for resolving invoice discrepancies, with 21% of suppliers indicating that these issues were not promptly addressed.
The survey also noted an alarming trend: a mere 10% of suppliers felt comfortable raising issues with retailers, indicating a significant gap in trust and communication.
Overall, these findings highlight a critical need for improved communication and dispute resolution processes between suppliers and retailers. While the GCA reports some improvement from the 2023 survey, it underscores the importance of a solution like Supplier Connect addressing industry pain points and enhancing retailer-supplier relationships.
Addressing Supplier Challenges with PRGX Supplier Connect
PRGX Supplier Connect is designed to mitigate these exact challenges, fostering a more transparent, efficient, and collaborative environment for both suppliers and retailers. The platform offers several key features that directly address the pain points highlighted in the GCA survey:
Unified Engagement Platform
By providing a singular portal for suppliers and retailers to connect, communicate, and collaborate, PRGX Supplier Connect reduces the time and effort wasted in navigating multiple channels for dispute resolution.
Self-Service Visibility
Suppliers can view invoices, payment statuses, and remittance details directly within the platform, significantly enhancing transparency and reducing the incidence of delayed payments
AI-Powered Dispute Management
The platform leverages artificial intelligence and machine learning to triage and resolve disputes efficiently. This capability not only speeds up dispute resolution but also helps in identifying and rectifying root causes, thereby reducing recurring issues.
Real-Time Monitoring and Reporting
PRGX Supplier Connect offers real-time visibility into dispute trends and SLA monitoring, empowering users with data-driven insights to improve strategies and outcomes.
Enhancing Supplier-Retailer Relationships
Effective dispute management is critical for maintaining healthy supplier relationships and optimizing business performance. Some notable ways that PRGX Supplier Connect can improve retailer-supplier interactions is by reducing unwarranted repayments, providing up-to-the minute communication directly through invoices, and reducing the friction that suppliers and retailers often face when information is difficult to find across disparate systems. By addressing these areas, PRGX Supplier Connect helps retailers and suppliers focus on growth rather than getting bogged down by disputes and administrative inefficiencies.
The platform’s capability to automate dispute management processes using AI/ML technologies is particularly significant because it enables intelligent filtering of low-quality disputes, automated responses to standard queries, and predictive analytics to suggest efficient dispute resolution actions. These features not only streamline the process but also ensure that disputes are handled with the necessary attention and accuracy, reducing the likelihood of erroneous repayments and improving overall trust between suppliers and retailers.
Real-World Impact: A Case Study with PRGX and a Top 25 Retailer
A notable case study involving a top U.S. retailer demonstrates the tangible benefits of implementing PRGX Supplier Connect. This retailer, managing tens of thousands of inquiries and hundreds of millions in disputes, saw a dramatic improvement in their processes post-implementation. Response times improved from 6-9 months to 20-50 days, and erroneous repay rates decreased by 75%, preventing millions in unnecessary repayments.
A Path Forward for UK Retailers and Suppliers
The findings from the GCA survey underline the critical need for robust, efficient, and transparent dispute management systems in retail. With PRGX Supplier Connect, retailers have a comprehensive solution that not only addresses these challenges but also enhances the overall supplier-retailer relationship. By leveraging cutting-edge AI and ML technologies, we are leading the way in transforming dispute management, ensuring timely payments, accurate forecasting, and stronger, more collaborative partnerships.
Download the whitepaper to learn how improved dispute management can strengthen supplier relationships.
Did you know: PRGX was recently awarded FSQS accreditation by the Hellios Foundation. This accreditation underscores our commitment to meeting the highest standards in: Business continuity, Financial, Insurance, IT and Information Security, Anti-Bribery, Recruitment, Operational Risks, and more.