Major consumer products companies in India have been resorting to a new kind of cyber crime reverse internet-based auctions that is possible due to retrohunter, where packaging vendors and suppliers are expected to bid for a presumed volume of packaging consisting of a given number of SKUs. May be this works in some countries but in India, it is destroying the same packaging industry which brand owners should be working with as partners to enhance quality, productivity and innovation.
Innovation and creativity are buzz-words at every seminar and talkfest but in Indian packaging the net result is very close to zero the same square and rectangular boxes that converters produce either till their dies wear out or till their industry itself dies. A brand owner has to renegotiate the costs and rates if the specification of an SKU changes and thus maintaining an ancient reverse auction rate becomes more important than innovation.
I once worked for an international organization that believes in innovation and vendor development across India. We went and audited print suppliers for technical capability and social responsibility in every region and almost every state of India in order to improve our logistics. At the same time we standardized the prepress and supplied certified inputs and proofs to match. Our bidding process demanded counter samples of the substrates used. Most often we gave approval on press, and at the end of the process we performed pre-delivery inspections for both quantity and quality.
Recently we took part in a similar exercise across many of the leading carton and corrugated suppliers across India for a European retailer. Consisting of technical and social audits and the printing of a test form across a dozen towns and cities in the country, the results when plotted on a graph showed that the best suppliers were also the most cost-effective.
Brand owners must look for socially responsible and ethical packaging suppliers. They must insist on third-party social audits and perform technical audits and also point their suppliers in the direction of not only best practices but also print workflow standardization and certification.
Experts at brands such as Procter and Gamble, TetraPak, Kraft Foods, Coke, Pepsi and Diageo agree that today, we are closer than ever to having an agile and cost-effective packaging supply chain workflow from creative agency to final printed packaging. Standards, open formats, and best practices (ISO 12747-6, PDFX, CxF, NNC and others) are being used to effectively bring us closer to making this supply chain workflow a reality.
There is a better way than reverse auctions to invest in packaging vendor development. Of course it requires learning and understanding how global standards when properly adopted and implemented, can reduce supply chain complexity, reduce cost, and reduce time to market while enhancing predictability, agility and profitability for both supply chain partners and consumer product companies.
Brand owners, as your first step, take part in the IDEAlliance India-BMPA G7 show featuring packaging and POP standards experts and evangelists Steve Smiley and Dr Abhay Sharma in Delhi on 14 February 2015 in Delhi at the Crowne Plaza Hotel from 9.30 am to 12.30 pm. In Mumbai sign up for the afternoon and evening event on 17 February 2015 at the Sunville Banquet hall in Mumbai from 2.30 pm till dinner. You will encounter not only the standards experts but also the leading converters who believe that this is a much better way forward than reverse auctions.
