[PnP-Focus] Re: Customer & Supplier (Answer to Rainal Lasumin)

Thanks for the enlightening ideas by Chris and Sheik. For your information
the scope of certification is "Production, Processing and Marketing of
Agro-based Products".

Our orgn. is not  a financial institution. We only facilitate the
unaffordable farmers based on win-win situation. We are government agency
enstrusted to improve the rural community through commercial agro-based
industry, while at the same time to increase our orgn. overall networth
value. Our main products are poultry, goat, honey, mushroom, lowland and
highland vegetables, tropical fruits and  palm oil. The business orientation
is market oriented. Whatever we produced (Own farm and our contract farmers'
produce) must be based on market/customer requirement.

If we regard the farmers as supplier, how should i explain the cumpolsary
saving deducted from thier sales.We kept thier money (5-10% of the net
profit) in the bank, and we kept thier bank book. They are given copy of the
updated account. In this sense can they be a supplier?

Even they received the loan (with interest), i fell they still be considered
as supplier in the sense that the capital given act as pre-payment ot thier
produce. Afterall we kept thier collateral in case thier farm fails.

Thanks.

Rainal Lasumin.
----- Original Message -----
From: "Chris Anderson" <chris at bizmanualz.com>
To: "PnP-Focus" <pnp-focus at lists.bizmanualz.com>
Sent: Thursday, October 27, 2005 7:56 PM
Subject: Re: [PnP-Focus] Re: Customer & Supplier (Answer to Rainal Lasumin)


> The question now is the business model.  If you have decided that your
> organization must offer loans to its suppliers in order to differentiate
> yourself in the market then the lending process is a core process and
> should be discussed within your purchasing and/or vendor selection
> process.  You will want to control such an important value-added
> activity to your business.
>
> But, if you make no material profit from the lending activity, then this
> might look like a negative payables (where you pay your suppliers before
> they deliver) and it would be difficult to call the farmers customers.
> ISO is not prescriptive so you can decide how to describe your
> business.  I think that if it's an important activity to your business
> model that is associated with your product flow (your suppliers --> your
> product realization --> your ultimate customers), then you should
> include it in your ISO documentation.
>
> Chris Anderson, CQA
> Bizmanualz, Inc.
>
> Sheikh Mohsin Ali wrote:
>
> >*As far as Chirs, CQA, Bizmanuals answers *
> >**
> >*I totally agree with him but again if loan is your business function to
> >facilitate the Farmers then they are not your Customers unless you are a
> >financial institution. So, I cannot conclude that there are two
processes.
> >Focus on the core business function which will be the Scope of
Certfication.
> >*
> >**
> >*If on the controrary your are a financial institution and giving loan to
> >the supplier then I have no problem. It really depends on the business
> >function. Its advisable not to make processess complicated.*
> >**
> >*Thank you*
> >**
> >*Sheikh Mohsin Ali*
> >
> >
> >Our Contract farmers supply us the products (poultry, raw honey,
mushroom)
> >for processing or sell directly to the market. They are our partners in
> >production. But at the same time we provide them loan and kept thier land
> >title(customer property) as collateral. We deduct thier loan via sales of
> >thier products, and we kept 5-10% of thier income in financial
institution
> >as compulsary saving. We kept thier bank pass book(customer property).
> >
> >(a) Can they also considered as customer, thereby providing processes as
> >required by 7.5.3?
> >
> >(b) What are the practical ways to distinguish between customer and
> >supplier?
> >
> >Thanks.
> >
> >Rainal Lasumin.
> >Sabah.Malaysia.
> >__
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> >PnP-Focus at lists.bizmanualz.com
> >http://lists.bizmanualz.com/cgi-bin/mailman/listinfo/pnp-focus
> >
> >
> >
>
>
> --
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>
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