Supplier innovation can't keep up with consumer demands on plastic
Demands from consumers for environmental changes were partly responsible for Waitrose’s decision to stop providing coffee cups to customers, according to John Lewis Partnership’s head of procurement operations Robert Turner.
Speaking on a panel about innovation at ProcureCon Indirect, Turner said a lack of scalable technology offered by suppliers also contributed to the decision.
Waitrose recently announced that while it will continue to provide free coffee to loyalty scheme members, they would need to bring a reusable cup to claim it. Disposable cups will be phased out entirely by autumn 2018, the company said. It was previously the biggest buyer of coffee cups in the UK, procuring 52m paper cups a year.
“The technology for recyclable coffee cups is still years away, and the technology is not scalable yet,” Turner explained. “My lead on CSR has been working with the CSR team in Waitrose to lead those conversations.
“Our suppliers aren’t able to innovate at the speed our customers are demanding. So, the cups will be gone and we won’t be buying them anymore.”
He said the supermarket had been pleasantly surprised by the positive public reaction to the decision.
Consumers are now pushing Waitrose to go even further: “People are starting to ask, ‘What are you going to do about other plastics in the supply chain?’”
Turner added that innovation doesn't always come from cutting edge technology or supplier activity. “It comes from having bold ideas and trying to lead a market and change opinion.”
Turner also shared how internal collaboration at John Lewis had led to significant savings in store openings and refurbishments.
“In building [the new Westfield store], it was clear we had everyone working in glorious isolation,” he said. “By [procurement] getting involved in coordinating those conversations with suppliers and internal stakeholders, we got better solutions.”
He used the example of brand professionals wanting to use a very high-end material for countertops in the store restaurant. Not only was the material costly, it was also too fragile for the intended purpose.
“One of our suppliers said, ‘We can do it cheaper, it will look the same, it won’t break, and it will cost you half the price’,” recalled Turner.
“The value that was freed up in our Westfield store gave us enough cash to refurbish our Oxford Street store for free,” he added. “That’s the value that came from working together collectively.”
Speaking on the same panel, Primark director of procurement Eavan O’Halloran agreed working cross-functionally could drive enormous value.
A close relationship between procurement, design, construction and maintenance on a store refit project had saved in the region of £60m, she said.
“It’s about understanding the flow of your process and understanding the cost of not working together,” she said. “Never underestimate the power of working together as an organisation. Innovation can only happen where there’s a shared objective.”
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