Better Buying Institute

BETTER BUYING INSTITUTE EXAMINES THE WAY THAT BUSINESS BETWEEN BUYERS AND THEIR SUPPLIERS IS CARRIED OUT ON A DAY-TO-DAY BASIS, WITH THE AIM OF TRANSFORMING THE PURCHASING PRACTICES COMMONLY USED IN THE CONSUMER GOODS SECTOR, SO BUSINESS RELASHIONSHIPS WITH SUPPLIERS SUPPORT DECENT WORKING CONDITIONS AND REDUCE ENVRONMENTAL IMPACTS OF PRODUCTION.

WE CONDUCTED INDEPENDENT RESEARCH ON BUYER PURCHASING PRACTICES. AS PART OF OUR CORE RESEARCH PROJECT, 2020 INDEX REPORT WAS PUBLISHED, DRAWING ON DATA GATHERED DURING Q4 OF 2019. THE REPORT REVEALED FOR THE FIRST TIME, SEVERAL SUBSCRIBERS' YEAR-OVER-YEAR IMPROVEMENTS IN PURCHASING PRACTICES. WE CARRIED OUT ANOTHER ANNUAL DATA COLLECTION USING OUR BETTER BUYING PURCHASING PRACTICES INDEX QUESTIONNAIRE DURING APRIL-JUNE. WE INVITED 3,380 SUPPLIERS WORLDWIDE TO ANONYMOUSLY RATE THE PERFORMANCE OF 21 BUYER COMPANIES. A TOTAL OF 1,245 RATINGS WERE SUBMITTED. THE FINDINGS REVEALED THAT RESPONSIBLE PURCHASING PRACTICES ARE BECOMING A TOP PRIORITY FOR BETTER BUYING'S SUBSCRIBER COMPANIES, RATHER THAN A "NICE TO HAVE" WHEN TIMES ARE GOOD. BUYER COMPANIES THAT HAD ALREADY BEGUN THE PROCESS OF IMPROVING THEIR PURCHASING PRACTICES PRIOR TO COVID-19 BY ENGAGING WITH BETTER BUYING CONTINUED IMPROVING IN SEVERAL AREAS. THE STORY WAS NOT 100% POSITIVE, HOWEVER, AS MIGHT BE EXPECTED GIVEN THE EVENTS OF THE LAST 18 MONTHS. DESPITE IMPROVEMENTS OVERALL IN PLANNING AND FORECASTING, FOR EXAMPLE, THIS WAS STILL THE AREA CITED BY SUPPLIERS AS THE ONE BUYERS NEEDED TO FOCUS ON IMPROVING FIRST. IN OTHER CATEGORIES, NEARLY TWO-THIRDS OF SUPPLIERS REPORTED THAT SOME OF THEIR BUYERS HAD CANCELED ORDERS AFTER THE PURCHASE ORDER HAD BEEN ISSUED, WHILE OTHERS SAW PAYMENT TERMS EXTENDED BY BUYERS WITHOUT THEIR APPROVAL. MONTHLY ORDER VARIABILITY INCREASED BY 20 PERCENTAGE POINTS COMPARED TO LAST YEAR, WHICH IMPACTED SUPPLIERS' SUSTAINABILITY EFFORTS. THERE REMAINS PLENTY FOR COMPANIES AND THE INDUSTRY AS A WHOLE TO DO TO ENSURE THEIR DAY-TO-DAY BUSINESS ACTIVITIES DO NOT HARM WORK ERS AND THE ENVIRONMENT. THE REPORT (DUBBED THE COVID REPORT BECAUSE IT COMPARES PURCHASING PRACTICES DURING THE PANDEMIC WITH THE PRE-COVID PRACTICES CAPTURED IN THE 2020 INDEX REPORT) WAS IN PROGRESS TO BE PUBLISHED IN THE NEXT TAX YEAR. DURING THE YEAR, WE ALSO PREPARED FOR A NEW ANNUAL DATA COLLECTION CYCLE THAT WILL TAKE PLACE EACH OCTOBER USING A NEW TOOL, THE BETTER BUYING PARTNERSHIP INDEX. THIS TOOL IS DESIGNED TO BRIDGE THE GAP BETWEEN THE INDEPTH SUPPLIER DATA COLLECTED THROUGH THE BETTER BUYING PURCHASING PRACTICES INDEX FOR BETTER BUYING'S ANNUAL SURVEYS IN APRIL, AND TO ACT AS A QUICK STATUS UPDATE, ENABLING YEAR-ROUND MONITORING AND ANALYSIS OF EMERGING ISSUES AND TRENDS AND POTENTIAL PROBLEM AREAS. COMPLETELY ANONYMOUS, THIS SHORT 5-MINUTE SURVEY ASKS SUPPLIERS 12 IMPACTFUL QUESTIONS ON KEY BUYER PRACTICES; OPERATIONAL EFFICIENCY AND THE MANAGEMENT OF KEY DEADLINES; FORECASTING VISIBILITY AND THE PREDICTABILITY OF FUTURE ORDERS; WHETHER FINANCIAL PRACTICES ARE FAIR AND TRANSPARENT; THE BUYER'S EFFORTS TO WORK WITH THE SUPPLIER TOWARDS IMPROVED SUSTAINABILITY; COMMUNICATIONS PRACTICES; AND THE BUYER'S STATUS AS A CUSTOMER OF CHOICE. AS WELL AS PROVIDING A RAPID INSIGHT INTO TIER-1 OF BUYERS' SUPPLY CHAINS, THE INDEX CAN ALSO BE USED ACROSS MULTIPLE INDUSTRIES, PRODUCT CATEGORIES AND GEOGRAPHIC REGIONS, AND AT DIFFERENT TIERS, INCLUDING MATERIAL MILLS, COMPONENTS, PACKAGING PROVIDERS AND CHEMICAL SUPPLIERS. THAT TOOL WAS SCHEDULED FOR LAUNCH IN THE NEXT TAX YEAR. USING OUR EXISTING DATA, WE ALSO WROTE AND PUBLISHED ADDITIONAL REPORTS AIMED AT HELPING THE INDUSTRY IMPROVE ITS PRACTICES. THESE REPORTS INCLUDED TWO DEEP DIVE REPORTS-ONE FOCUSED ON "BETTER" DESIGN AND DEVELOPMENT AND ANOTHER EXPLORING MONTHLY ORDER VARIABILITY. WE ALSO PUBLISHED THE BETTER BUYING SPOTLIGHT ON HARDGOODS, AND THE BETTER BUYING SPECIAL REPORT ON PURCHASING PRACTICES AND SUSTAINABILITY. WE KICKED-OFF A SERIES OF SUPPLIER ROUNDTABLES THAT ALLOWED US TO DEVELOP DEEPER, MORE NUANCED UNDERSTANDINGS OF SPECIFIC TOPICS AND HOW TO ADDRESS THEM. WE COMPLETED ONE SUPPLIER ROUNDTABLE ON MONTHLY ORDER VARIABILITY AND PUBLISHED A REPORT FROM THAT. WE ALSO COLLECTED DATA IN A SECOND SUPPLIER ROUNDTABLE THAT FOCUSED ON COSTING STRATEGIES THAT WILL RESULT IN FAIR PRICES AND BETTER SUPPORT FOR SUPPLIERS TO IMPROVE WORKING CONDITIONS AND WAGES IN THEIR FACTORIES. A REPORT FROM THAT RESEARCH IS IN PROGRESS. AS PART OF OUR INNOVATIVE PROJECTS, WE PARTICIPATED IN TWO PROJECTS IN PARTNERSHIP WITH OTHER ORGANIZATIONS. IN ONE PROJECT WE DRAFTED A TOOL IDENTIFYING IMPACTS OF PURCHASING PRACTICES ON FACTORY COMPLIANCE TO CODES OF CONDUCT AND PREPARED TO PILOT ITS USABILITY. IN ANOTHER PROJECT, WE ANALYZED DATA COLLECTED FROM SUPPLIERS AND THEIR WORKERS IN VIETNAM TO UNDERSTAND HOW THEY EXPERIENCED COVID-19 AND THE IMPACTS PURCHASING PRACTICES HAD ON WORKER WELL-BEING. THIS PROJECT RESULTED IN A REPORT ASSESSING PURCHASING PRACTICES IMPACTS ON SUPPLIERS AND WORKERS. IN REGARDS TO PLATFORM OPERATIONS PROGRAM OF WORK, WE OPERATED A CLOUDBASED RATINGS AND EVALUATION PLATFORM THAT ENABLES PARTICIPATING SUPPLIERS TO PROVIDE INFORMATION ABOUT THEIR BUYERS ONLINE. SOME MINOR CHANGES WERE MADE TO THE QUESTIONNAIRE. A FEW NEW QUESTIONS WERE ADDED TO COVER TOPICS, SUCH AS ORDER CANCELLATION, THAT BECAME MORE PROBLEMATIC BECAUSE OF COVID. WE IMPROVED FUNCTIONALITY SUPPORT MORE EFFICIENT REPORTING.

AS PART OF OUR INNOVATIVE PROJECTS, WE PARTICIPATED IN TWO PROJECTS IN PARTNERHSIP WITH OTHER ORGANIZATIONS. IN ONE PROJECT WE DRAFTED A TOOL IDENTIFYING IMPACTS OF PURCHASING PRACTICES IN FACTORY COMPLIANCE TO CODES OF CONDUCT AND PREPARED TO PILOT ITS USABILITY. IN ANOTHER PROJECT, WE ANALYZED DATA COLLECTED FROM SUPPLIERS AND THEIR WORKERS IN VIETNAM TO UNDERSTAND HOW THEY EXPERIENCED COVID-19 AND THE IMPACTS PURCHASING PRACTICES HAD ON WORKER WELL-BEING. THIS PROJECT RESULTED IN A REPORT ASSESSING PURCHASING PRACTICES IMPACTS ON SUPPLIERS AND WORKERS.

IN REGARDS TO PLATFORM OPERATIONS PROGRAM OF WORK, WE OPERATED A CLOUDBASED RATINGS AND EVALUATION PLATFORM THAT ENABLES PARTICIPATING SUPPLIERS TO PROVIDE INFORMATION ABOUT THEIR BUYERS ONLINE. SOME MINOR CHANGES WERE MADE TO THE QUESTIONNAIRE. A FEW NEW QUESTIONS WERE ADDED TO COVER TOPICS, SUCH AS ORDER CANCELLATION, THAT BECAME MORE PROBLEMATIC BECAUSE OF COVID. WE IMPROVED FUNCTIONALITY SUPPORT MORE EFFICIENT REPORTING

WE TOOK THE FIRST STEP IN CREATING A TRAINING PROGRAM. WE WWORKED WITH FOUR COMPANIES TO CO-CREATE A FOUNDATIONAL LEVEL, E-LEARNING COURSE THAT INTRODUCES THE FIVE PRINCIPLES OF RESPONSIBLE PURCHASING. AT THE END OF THE TAX YEAR, TH COURSE WAS READY FOR FINAL EDITS, AND WE PLANNED TO LAUNCH IT NEAR THE END OF THE CALENDAR YEAR. THE COURSE WILL BE MADE AVAILABLE TO COMPANIES AND OTHER ORGANIZATIONS AROUND THE WORLD FOR A MODEST PER USER FEE TO SUPPORT BROAD INTEGRATION OF RESPONSIBLE PURCHASING THROUGHOUT COMPANIES OF ALL SIZES AND TYPES. THE FIVE PRINCIPLES OF RESPONSIBLE PURCHASING THAT SERVE AS THE FOCAL AREA OF EMPHASIS FOR THE COURSE HAVE ALSO BEEN RELEASED PUBLICLY TO SUPPORT CLARITY AND ALIGNMENT ON GOALS FOR THE INDUSTRY TO PURSUE.

WE CONDUCTED INDEPENDENT RESEARCH ON BUYER PURCHASING PRACTICES. AS PART OF OUR CORE RESEARCH PROJECT, 2020 INDEX REPORT WAS PUBLISHED, DRAWING ON DATA GATHERED DURING Q4 OF 2019. THE REPORT REVEALED FOR THE FIRST TIME, SEVERAL SUBSCRIBERS' YEAR-OVER-YEAR IMPROVEMENTS IN PURCHASING PRACTICES. WE CARRIED OUT ANOTHER ANNUAL DATA COLLECTION USING OUR BETTER BUYING PURCHASING PRACTICES INDEX QUESTIONNAIRE DURING APRIL-JUNE. WE INVITED 3,380 SUPPLIERS WORLDWIDE TO ANONYMOUSLY RATE THE PERFORMANCE OF 21 BUYER COMPANIES. A TOTAL OF 1,245 RATINGS WERE SUBMITTED. THE FINDINGS REVEALED THAT RESPONSIBLE PURCHASING PRACTICES ARE BECOMING A TOP PRIORITY FOR BETTER BUYING'S SUBSCRIBER COMPANIES, RATHER THAN A "NICE TO HAVE" WHEN TIMES ARE GOOD. BUYER COMPANIES THAT HAD ALREADY BEGUN THE PROCESS OF IMPROVING THEIR PURCHASING PRACTICES PRIOR TO COVID-19 BY ENGAGING WITH BETTER BUYING CONTINUED IMPROVING IN SEVERAL AREAS. THE STORY WAS NOT 100% POSITIVE, HOWEVER, AS MIGHT BE EXPECTED GIVEN THE EVENTS OF THE LAST 18 MONTHS. DESPITE IMPROVEMENTS OVERALL IN PLANNING AND FORECASTING, FOR EXAMPLE, THIS WAS STILL THE AREA CITED BY SUPPLIERS AS THE ONE BUYERS NEEDED TO FOCUS ON IMPROVING FIRST. IN OTHER CATEGORIES, NEARLY TWO-THIRDS OF SUPPLIERS REPORTED THAT SOME OF THEIR BUYERS HAD CANCELED ORDERS AFTER THE PURCHASE ORDER HAD BEEN ISSUED, WHILE OTHERS SAW PAYMENT TERMS EXTENDED BY BUYERS WITHOUT THEIR APPROVAL. MONTHLY ORDER VARIABILITY INCREASED BY 20 PERCENTAGE POINTS COMPARED TO LAST YEAR, WHICH IMPACTED SUPPLIERS' SUSTAINABILITY EFFORTS. THERE REMAINS PLENTY FOR COMPANIES AND THE INDUSTRY AS A WHOLE TO DO TO ENSURE THEIR DAY-TO-DAY BUSINESS ACTIVITIES DO NOT HARM WORK ERS AND THE ENVIRONMENT. THE REPORT (DUBBED THE COVID REPORT BECAUSE IT COMPARES PURCHASING PRACTICES DURING THE PANDEMIC WITH THE PRE-COVID PRACTICES CAPTURED IN THE 2020 INDEX REPORT) WAS IN PROGRESS TO BE PUBLISHED IN THE NEXT TAX YEAR. DURING THE YEAR, WE ALSO PREPARED FOR A NEW ANNUAL DATA COLLECTION CYCLE THAT WILL TAKE PLACE EACH OCTOBER USING A NEW TOOL, THE BETTER BUYING PARTNERSHIP INDEX. THIS TOOL IS DESIGNED TO BRIDGE THE GAP BETWEEN THE INDEPTH SUPPLIER DATA COLLECTED THROUGH THE BETTER BUYING PURCHASING PRACTICES INDEX FOR BETTER BUYING'S ANNUAL SURVEYS IN APRIL, AND TO ACT AS A QUICK STATUS UPDATE, ENABLING YEAR-ROUND MONITORING AND ANALYSIS OF EMERGING ISSUES AND TRENDS AND POTENTIAL PROBLEM AREAS. COMPLETELY ANONYMOUS, THIS SHORT 5-MINUTE SURVEY ASKS SUPPLIERS 12 IMPACTFUL QUESTIONS ON KEY BUYER PRACTICES; OPERATIONAL EFFICIENCY AND THE MANAGEMENT OF KEY DEADLINES; FORECASTING VISIBILITY AND THE PREDICTABILITY OF FUTURE ORDERS; WHETHER FINANCIAL PRACTICES ARE FAIR AND TRANSPARENT; THE BUYER'S EFFORTS TO WORK WITH THE SUPPLIER TOWARDS IMPROVED SUSTAINABILITY; COMMUNICATIONS PRACTICES; AND THE BUYER'S STATUS AS A CUSTOMER OF CHOICE. AS WELL AS PROVIDING A RAPID INSIGHT INTO TIER-1 OF BUYERS' SUPPLY CHAINS, THE INDEX CAN ALSO BE USED ACROSS MULTIPLE INDUSTRIES, PRODUCT CATEGORIES AND GEOGRAPHIC REGIONS, AND AT DIFFERENT TIERS, INCLUDING MATERIAL MILLS, COMPONENTS, PACKAGING PROVIDERS AND CHEMICAL SUPPLIERS. THAT TOOL WAS SCHEDULED FOR LAUNCH IN THE NEXT TAX YEAR. USING OUR EXISTING DATA, WE ALSO WROTE AND PUBLISHED ADDITIONAL REPORTS AIMED AT HELPING THE INDUSTRY IMPROVE ITS PRACTICES. THESE REPORTS INCLUDED TWO DEEP DIVE REPORTS-ONE FOCUSED ON "BETTER" DESIGN AND DEVELOPMENT AND ANOTHER EXPLORING MONTHLY ORDER VARIABILITY. WE ALSO PUBLISHED THE BETTER BUYING SPOTLIGHT ON HARDGOODS, AND THE BETTER BUYING SPECIAL REPORT ON PURCHASING PRACTICES AND SUSTAINABILITY. WE KICKED-OFF A SERIES OF SUPPLIER ROUNDTABLES THAT ALLOWED US TO DEVELOP DEEPER, MORE NUANCED UNDERSTANDINGS OF SPECIFIC TOPICS AND HOW TO ADDRESS THEM. WE COMPLETED ONE SUPPLIER ROUNDTABLE ON MONTHLY ORDER VARIABILITY AND PUBLISHED A REPORT FROM THAT. WE ALSO COLLECTED DATA IN A SECOND SUPPLIER ROUNDTABLE THAT FOCUSED ON COSTING STRATEGIES THAT WILL RESULT IN FAIR PRICES AND BETTER SUPPORT FOR SUPPLIERS TO IMPROVE WORKING CONDITIONS AND WAGES IN THEIR FACTORIES. A REPORT FROM THAT RESEARCH IS IN PROGRESS. AS PART OF OUR INNOVATIVE PROJECTS, WE PARTICIPATED IN TWO PROJECTS IN PARTNERSHIP WITH OTHER ORGANIZATIONS. IN ONE PROJECT WE DRAFTED A TOOL IDENTIFYING IMPACTS OF PURCHASING PRACTICES ON FACTORY COMPLIANCE TO CODES OF CONDUCT AND PREPARED TO PILOT ITS USABILITY. IN ANOTHER PROJECT, WE ANALYZED DATA COLLECTED FROM SUPPLIERS AND THEIR WORKERS IN VIETNAM TO UNDERSTAND HOW THEY EXPERIENCED COVID-19 AND THE IMPACTS PURCHASING PRACTICES HAD ON WORKER WELL-BEING. THIS PROJECT RESULTED IN A REPORT ASSESSING PURCHASING PRACTICES IMPACTS ON SUPPLIERS AND WORKERS. IN REGARDS TO PLATFORM OPERATIONS PROGRAM OF WORK, WE OPERATED A CLOUDBASED RATINGS AND EVALUATION PLATFORM THAT ENABLES PARTICIPATING SUPPLIERS TO PROVIDE INFORMATION ABOUT THEIR BUYERS ONLINE. SOME MINOR CHANGES WERE MADE TO THE QUESTIONNAIRE. A FEW NEW QUESTIONS WERE ADDED TO COVER TOPICS, SUCH AS ORDER CANCELLATION, THAT BECAME MORE PROBLEMATIC BECAUSE OF COVID. WE IMPROVED FUNCTIONALITY SUPPORT MORE EFFICIENT REPORTING.

AS PART OF OUR INNOVATIVE PROJECTS, WE PARTICIPATED IN TWO PROJECTS IN PARTNERHSIP WITH OTHER ORGANIZATIONS. IN ONE PROJECT WE DRAFTED A TOOL IDENTIFYING IMPACTS OF PURCHASING PRACTICES IN FACTORY COMPLIANCE TO CODES OF CONDUCT AND PREPARED TO PILOT ITS USABILITY. IN ANOTHER PROJECT, WE ANALYZED DATA COLLECTED FROM SUPPLIERS AND THEIR WORKERS IN VIETNAM TO UNDERSTAND HOW THEY EXPERIENCED COVID-19 AND THE IMPACTS PURCHASING PRACTICES HAD ON WORKER WELL-BEING. THIS PROJECT RESULTED IN A REPORT ASSESSING PURCHASING PRACTICES IMPACTS ON SUPPLIERS AND WORKERS.

IN REGARDS TO PLATFORM OPERATIONS PROGRAM OF WORK, WE OPERATED A CLOUDBASED RATINGS AND EVALUATION PLATFORM THAT ENABLES PARTICIPATING SUPPLIERS TO PROVIDE INFORMATION ABOUT THEIR BUYERS ONLINE. SOME MINOR CHANGES WERE MADE TO THE QUESTIONNAIRE. A FEW NEW QUESTIONS WERE ADDED TO COVER TOPICS, SUCH AS ORDER CANCELLATION, THAT BECAME MORE PROBLEMATIC BECAUSE OF COVID. WE IMPROVED FUNCTIONALITY SUPPORT MORE EFFICIENT REPORTING

WE TOOK THE FIRST STEP IN CREATING A TRAINING PROGRAM. WE WWORKED WITH FOUR COMPANIES TO CO-CREATE A FOUNDATIONAL LEVEL, E-LEARNING COURSE THAT INTRODUCES THE FIVE PRINCIPLES OF RESPONSIBLE PURCHASING. AT THE END OF THE TAX YEAR, TH COURSE WAS READY FOR FINAL EDITS, AND WE PLANNED TO LAUNCH IT NEAR THE END OF THE CALENDAR YEAR. THE COURSE WILL BE MADE AVAILABLE TO COMPANIES AND OTHER ORGANIZATIONS AROUND THE WORLD FOR A MODEST PER USER FEE TO SUPPORT BROAD INTEGRATION OF RESPONSIBLE PURCHASING THROUGHOUT COMPANIES OF ALL SIZES AND TYPES. THE FIVE PRINCIPLES OF RESPONSIBLE PURCHASING THAT SERVE AS THE FOCAL AREA OF EMPHASIS FOR THE COURSE HAVE ALSO BEEN RELEASED PUBLICLY TO SUPPORT CLARITY AND ALIGNMENT ON GOALS FOR THE INDUSTRY TO PURSUE.