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Strategic commitment to an efficient and sustainable value chain
DIA works together with its suppliers to turn its ambition of offering quality at unbeatable prices into a reality; this reality is increasingly predicated on the range of private-label and perishable products. In order to achieve and defend this goal, the company is strategically committed to having an efficient and sustainable supply chain dominated by local suppliers selected in accordance with quality and safety criteria. These suppliers receive and share relevant information though three websites used exclusively by DIA suppliers and over the DIA World Trade platform for major international companies.
3.5.1 Commitment to local business communities
In a conscious attempt to contribute to economic development in its operating regions, the company seeks to consistently enter into agreements with local suppliers for the manufacture of the products it sells under its private-label brands and for the supply of fresh products.
Of DIA´s 4,816 suppliers, 83.5% are local, directly servicing one or more of DIA’s national divisions.
The percentage of local suppliers is even higher in fast-growing markets, such as China (100%), Argentina (97.6%) and Brazil (96.4%). In Europe, the figures are also significant: in Spain and France, national suppliers account for 83.3% and 79.6% of the total, respectively; in Portugal the percentage of local suppliers is lower (58.5%), although purchases from this portion of the supplier base accounts for 77.8% of the total purchase value.
By country, local suppliers accounted for 100% of purchases in China, over 99% in Argentina and Brazil, more than 90% in France, and over 90% and 78% in Spain and Portugal, respectively.
3.5.2 Supplier selection based on quality criteria
At the latter stages of supplier section for private-label products, candidates must pass a rigorous upfront certification audit, designed to guarantee food safety at every factory in which DIA products will be made.
The audits, to which all private-label suppliers are subjected, are carried out using in-house standards or widely recognised standards such as the IFS and BRC food quality and safety standards. The audit serves to evaluate the general management of activities and facilities, the specific production conditions and the quality management system.
Supplier audits and consumer tests are carried out regularly after the product is on the market as a way to ensure the quality, safety and favourable customer perception of DIA products over time.
3.5.3 Mutually beneficial collaboration
The company seeks to maintain supplier relations based on mutual trust and is convinced that staying in tune with this stakeholder group translates into more benefits for both parties and a better end product.
DIA works continually to ensure mutually beneficial development and nurturing of these ties. To this end it operates three websites exclusively for suppliers through which it shares financial, commercial and logistics information. The content of these three online platforms includes key business management and development information. They save time and make both parties´ work more flexible and efficient by providing access to historical sales information by product category and item, service levels, days of stock, order incidents, etc.
Along this same line of initiative, at the end of 2011 DIA launched a supplier management platform called DIA World Trade for use by major international suppliers. More than 90 suppliers use this platform.