4 supplier collaboration strategies that boost retail brand loyalty

by | Oct 31, 2024 | Data Management, Inventory Management, Order Fulfillment, Order Management, Retailers

Brand loyalty isn’t what it used to be. Customer expectations are increasing by 30% annually, according to brand researchers. Loyalty hinges on creating emotional connections that bridge the gap between customer expectations and experience. Through these emotional connections, top-performing retailers consistently outpace their competition.

So, how can retailers meet rising consumer demands? One effective approach is to create greater alignment with suppliers. We’ve identified four strategies to boost brand loyalty through supplier partnerships.

1. Align customer experience across channels

Today’s customers demand consistent experiences whether they shop online, in-store or through a combination of channels. Industry studies indicate that 73% of consumers purchase items online that they previously only bought in-store, blurring the line between digital and physical retail.

Achieving omnichannel consistency requires retailers and suppliers to work in tandem. By synchronizing product availability across channels, unifying product data and optimizing fulfillment, retailers and suppliers can deliver the frictionless experience customers crave.

2. Predict and prevent stockouts

Nothing frustrates customers more than encountering empty shelves or “out of stock” notifications. According to McKinsey, 70 to 80% of consumers will switch brands or retailers if they encounter stockouts. These inventory gaps often stem from phantom inventory (when systems show products as available, but they’re missing), order mismanagement (errors in processing or fulfilling orders) or delayed shipments to stores or consumers.

Retailers can prevent shortages by partnering with suppliers to share updates on orders and shipments. This collaboration should focus on:

  • Enhancing visibility into shipments to distribution centers, stores and customers.
  • Establishing clear delivery timelines and performance metrics.
  • Joint forecasting to ensure adequate stock levels.
  • Developing contingency plans for potential delays or supply chain disruptions.

3. Foster transparency and accountability

Open communication and transparency form the cornerstone of successful retailer-supplier partnerships. By sharing accurate, real-time data on inventory levels, lead times and order fulfillment, both parties can preempt misunderstandings and mitigate costly delays.

Clear accountability measures, such as performance scorecards, empower retailers and suppliers to track progress collaboratively, leading to faster issue resolution and improved performance. When retailers and suppliers operate with openness and mutual trust, they create a more resilient supply chain that strengthens brand loyalty.

Retailers need tools that provide a clear view of what’s happening across the supply chain. These solutions foster better alignment both internally and with suppliers. With enhanced visibility, retailers can:

  • Anticipate problems before they occur.
  • Minimize disruptions.
  • Maximize operational efficiency.
  • Optimize costs.
  • Enhance customer experience.

4. Meet customers’ sustainability demands

Modern consumers vote with their wallets. Nearly 6 in 10 consumers are willing to change their purchasing habits to reduce their environmental impact, according to the National Retail Federation.

Major retailers are taking note. For example, Walmart’s Project Gigaton initiative aims to reduce or avoid one billion metric tons of greenhouse gases from the global value chain by 2030.

Retailers who partner with sustainability-focused suppliers and transparently share these practices build trust with increasingly conscious consumers. This requires retailers and suppliers to share detailed sustainability data, such as carbon emissions and materials sourcing. By collecting and validating supplier information, retailers can substantiate their sustainability claims and enhance credibility with environmentally conscious consumers.

Build lasting brand loyalty

Loyal customers are the heart of any thriving retail business. They’re repeat buyers, bigger spenders and brand advocates. When you invest in stronger supplier relationships, you’re also investing in customer loyalty. It’s a powerful way to build lasting customer connections.

Ready to transform supplier relationships into a brand loyalty advantage? Explore solutions on our website or get personalized insights from our team.

SPS Commerce Blog Team
Latest posts by SPS Commerce Blog Team (see all)
Woman at computer

RELATED POSTS