Customers and
suppliers

Active stakeholder engagement

Frank discussions and open co-operation help Vetropack to anticipate the needs of customers and other stakeholders, to identify business opportunities and to establish competitive advantages. The stakeholder groups, which influence Vetropack’s business activity or are affected by it, include investors, customers, suppliers, employees and their representatives, the general public and society in general, including supervisory authorities, legislators, trade associations and non-government organisations (NGOs).

Information on communication with employees can be found in the Performance Review under “Employee engagement”.

Find out more about supplier relationships in the Performance Review under “Process innovation with suppliers” and “Multi-supplier strategy”.

More detailed information on the issue of customer loyalty can be found in the Performance Review under “Innovation through customer-specific products”.

Additional information on engagement with other stakeholder groups, such as investors and associations, can be found in the Sustainability Report under the issue “Stakeholder engagement”.

Multi-supplier strategy

Vetropack pursues a multi-supplier strategy to guarantee a smooth production process. This strategy secures its supply of raw materials and equipment and minimises risks in the supply chain, such as being disproportionately dependent on suppliers. The Group attaches great importance to strengthen-ing and expanding co-operation in the supply chain, especially with suppliers of strategic importance.

On the supplier side, the trend is towards consolidation and concentration, especially with suppliers of equipment. The global expansion in capacity in the glass packaging industry also led to a dramatic increase in demand for production equipment and consequently to longer throughput times. These developments contributed to Vetropack increasingly concentrating on identifying new suppliers. New suppliers make it easier to implement the multi-supplier strategy, such as in the case of specialist suppliers of sodium carbonate. However, it is more difficult to prevent dependencies on individual suppliers in monopolistic markets, such as in the software sector. In these markets, it is virtually impossible to change suppliers without material negative consequences.

In 2019, Vetropack continued its analysis of the market and identified potential new suppliers, which were checked in accordance with the requirements of the code of conduct for suppliers. The assessment criteria include compliance with quality standards, information about the owners, financial performance indicators, the number of employees and the company’s history. The Group also carries out integration tests with new suppliers on an ongoing basis. One result of these efforts was the success-ful validation of a supplier of testing technology, followed by the installation of new testing machinery. Vetropack also succeeded in extending long term contracts with strategically important suppliers. It is increasingly difficult to extend contracts in this way given the lack of clarity regarding the global economic outlook and the challenges of long term planning associated therewith.

The validation and integration of additional suppliers to secure procurement of raw materials and equipment are short term priorities. In the execution of digitisation projects, in particular, Vetropack endeavours to find a balance between collaborating with specialists and avoiding dependencies.

Vetropack uses key performance indicators (KPIs), such as the number of active suppliers per category and the number of long term contracts, to measure progress in its supplier strategy. The aim is to minimise supply and price risks and to establish alternatives to improve Vetropack’s negotiating position.

Health and safety of customers and consumers

Its high quality and professional processing of the packaging material glass mean that Vetropack not only protects the packaged drinks and foodstuffs but also consumers’ health. The company checks each individual glass container. Product quality and security is therefore an essential factor, which is taken into account for each product development in accordance with clearly defined criteria. Vetropack uses specific quality indicators, which are covered by commercial secrecy, to measure quality and security.

In 2019, Vetropack again invested in refining the quality control process for products. The quality assurance work group is pressing ahead with the harmonisation of the quality assurance processes. For example, it successfully implemented a project to standardise the error code by which product defects are defined to ensure that statistical recording is uniform in all plants. Vetropack also invested in improving testing technology. For instance, among other changes, the latest versions of the testing sets, which are more effective in detecting faulty glass containers, were installed In future, the development process is to be upgraded and the specific quality and security requirements of the various product groups are to be more precisely differentiated.