Guest Post: 7 Benefits of Transparency in Supply Chain That You Should Know

Apr 21, 2022

(Image Source: Detego)

There is no doubt that the COVID-19 pandemic has severely impacted many businesses. Whilst some have been able to rapidly adapt to the changed circumstances by employing various strategies, such as using business continuity management software, others have been left to handle the difficult process of rebuilding. If this pandemic has taught us anything, it is that we should take as many measures as possible to remain ahead of any difficult events to have the best chance of flourishing. This includes ensuring that we are aware of what goes on inside our own company.It is vital to know exactly what is going on in your business to make sure everything is above board and follows the relevant regulations. It is also important for consumers to feel that they are making informed decisions when purchasing your products. Nowadays, people are increasingly aware of the impact they can have on the world, from climate change to human rights, via their buying habits. This is why supply chain transparency is something businesses should aim for. This article will tell you what supply chain transparency involves and how it can benefit your business. 

What Is Transparency?

Transparency in the context of supply chains can be summed up as a company having full knowledge of what happens at every stage of its supply chain. A business can do this by collecting data or information from all of the links within its chain. Once the data has been collected, the company then needs to relay it to the relevant parties, both internal and external. 

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What Is a Supply Chain?

A supply chain consists of the entire system that exists between a company and its suppliers to produce and distribute their product to the end consumer. It involves different activities, people, and resources.For instance, a generic supply chain goes something like this: 

  • Sourcing and extracting the raw materials.

  • Delivering materials to a supplier (usually done by a logistics provider).

  • Taking the materials to one or more manufacturers who will refine the product into its finished version.

  • Giving the end product to a distributor who wholesales it to one or more retailers. 

  • Selling the product to consumers, who are then free to buy it from the retailers if they wish to.

From this, you can see that there are many individuals involved in a business’ supply chain – logistics providers, manufacturers, distributors, retailers, etc. This is why it is crucial to keep up with everyone and ensure company policies and regulations are being upheld. Though this can be a bit of a challenge, there are technologies available to overcome this hurdle, such as voice over IP phone numbers, which allows you to place calls, hold meetings, send messages, and the like using only an Internet connection. Technologies such as this are extremely convenient for businesses needing to maintain ongoing communications across departments. Those with online businesses can also hire a virtual e-commerce assistant to help them keep track of the tasks at hand so they can be confident that they are staying on top of their work as opposed to drowning in it.

Why Is It Important? 

At this point, you might be wondering exactly why a company needs to bother with supply chain transparency.The first thing to mention is that more stringent laws are being outlined by various governments in different countries in an effort to ensure the welfare of their people. These laws tend to revolve around difficult topics such as human slavery, human rights, and the protection of resources from countries that are at war. For instance, the Dodd–Frank Act, a U.S law which was passed in 2010, requires companies to check their supply chains to ensure more responsible trading of natural resources.Somewhat linked to this is the fact that today’s society is increasingly ethics-conscious. As we already briefly mentioned, consumers are more aware of their impact on their community and more generally, the world, than they were previously. This means that they are nowadays more careful about what they buy and who they buy from. Being able to demonstrate where your products come from is therefore something that is appreciated by many, if not most consumers. Moreover, 57% of companies consider supply chain management a way to gain a competitive edge. We will be talking about this in more detail in the following section, which outline 7 benefits of transparency in your supply chain.

(Image Source: Unsplash)

7 Benefits of transparency 

Customer Assurance

Just as companies have their own values, so do individuals. Consumers like to purchase from businesses with morals or values that align with their own. Building customer relationships is more important now than ever, particularly in the e-commerce world. Showing your consumers that you share values is a good way of doing just that.The information you collect to achieve transparency also provides unique content creation opportunities which can strengthen the integrity of your platform and avoid duplicate content SEO issues that some businesses struggle with. Content revolving around your company’s policies, respect of regulations, and efforts to be ethically-conscious in your operations can be a bridge between you and your customers.Transparency also encourages customers to communicate concerns they have about your brand. It fosters an open line of discussion, as transparency shows a willingness to share. You can further enhance this by providing a toll-free number that your customers can use to reach you in order to facilitate this exchange. Doing so can lead to higher levels of customer assurance and customer retention.

Brand Loyalty

Customers are more likely to trust a brand if they know where their products are coming from. They are also more likely to make repeat purchases if they are satisfied that the product is of high quality and sourced ethically.You can use transparency as a way to connect with your consumers and increase or maintain their loyalty. For instance, you could launch a campaign involving an impactful video ad outlining how your business strives to operate in a way that safeguards human rights and the environment.Providing this information on your brand website can also influence a customer’s decision as to whether they want to give you their business. For example, for an e-commerce business, there is a relatively short window of time during which the customer can be convinced to stay on the site. E-commerce ‘moments of truth’, a term referring to the point at which a visitor decides whether to stay or leave your site, are not just about the website design, but also about the content. If you include content that is relevant and likely to strike a chord with your consumers, they are more likely to stay.

(Image Source: Unsplash)

Stronger Business Relationships

Companies which don’t show an effort to be transparent can come across as unprofessional. Nobody wants to spend their time doing background checks to verify whether the business they want to invest in or work with is involved in legitimate practices and above board.Showing potential business partners how serious you are about transparency communicates a level of honesty and forthcomingness that is desirable and can only be a positive when it comes to business relationships.

More Attractive to Investors

Everybody appreciates transparency, but it is particularly important to those who are thinking of investing or involving themselves in your business. Many investors are now not only looking for businesses beneficial to them in terms of financial returns, but also those that can make a positive impact on the environment and society.Being able to show that your business is one that respects the regulations and does not infringe on human rights or the environment is therefore a good way to attract more investors. It allows them to see that you can be trusted, and that they can move forward with investments without worrying about a lack of disclosure.

Identifying Problem Areas

Collecting data on the links in your supply chain also allows you to spot any areas that need to be optimized in order to develop a more effective and streamlined process.For instance, you might find that the communication between your links is ineffective and time consuming. Tackling this may involve the use of technologies such as hybrid cloud architectures, which present a secure and flexible way to facilitate communication between different teams within your company.There can also be issues with processes within your supply chain. For instance, if you are an e-commerce business, you may notice that the time it takes for a customer to receive your product is too long. This can be a very real problem for some, as transit time impacts customer satisfaction heavily. Transparency can help identify why these issues are occurring so that you can begin to think about a solution.

Warehousing and supply chain

(Image Source: Unsplash)

Ensure compliance with your own regulations and policies

While transparency is important to ensure your company is adhering to the relevant laws, it is also useful in making sure that the business is in line with the values and policies according to which it should be operating. Not doing so could negatively affect your reputation and impact relationships with business investors, partners, and customers.

Better Employee Experience

In an ideal world, we would all be working for companies that reflect our values and principles perfectly. Though this isn’t always attainable, it can be within reach. For this reason, being transparent about your supply chain can show your staff that you truly adhere to the policies you set out. This fosters respect and trust from employees, and allows them to see the ways in which company values align with their own.


Though it can be daunting to put so much information about your business out there, supply chain transparency is important for yourself, to make sure everything is legitimate, as well as for others. This transparency is a clear signal that you can be trusted, and can influence the way in which your business is perceived.

About the author

Jenna Bunnell – Senior Manager, Content Marketing, Dialpad

Jenna Bunnell is the Senior Manager for Content Marketing at Dialpad, an AI-incorporated cloud-hosted unified communications system that provides valuable call details for business owners and sales representatives. She is driven and passionate about communicating a brand’s design sensibility and visualizing how content can be presented in creative and comprehensive ways. Jenna has also written for sites such as Lucky Orange and AirDroid. Check out her LinkedIn profile.

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