By Daniel Duty, CEO and Co-Founder, Conlego.
Sometimes retailers and brands could use a little help aligning on a joint strategy, business plans or innovation paths. Sometimes they could use some help when dead-locked on a way to solve a problem they share, such as supply chain methods or marketing approaches. Other times they need help resolving a dispute before legal action is required. Facilitation and mediation are two similar solutions employed by businesses throughout the world that have largely been ignored in the retail ecosystem. Perhaps it is time to change that.
So, what are facilitation and mediation? Basically, they are proven methods for “getting on the same page” and finding agreement or common ground. In these processes, a neutral third party with expertise in the field helps the parties understand their respective interests, needs, plans, and positions. The neutral third party, while keeping information confidential, shuttles between the parties based on what is known from both sides, to help the parties reach a solution that can work for both. Most often, this results in a “win-win" outcome.
In a recent case, I was asked to facilitate a roadblock between a major grocer and an important owned-brands supplier over a joint business plan. The retailer believed the supplier was not stepping up to the plate in its costs and investments in the business. The supplier felt the retailer was asking for too much based on current sales.
What I learned from the retailer was they were making major investments in their owned brand capabilities and dedicating a higher percentage of shelf space to its own brands. I learned from the supplier, they needed an increase in sales order to invest, and would do so if they understood the plans for increasing business in more detail. Understanding this, I helped the retailer disclose more of its “confidential” plans for owned brands, including its plan to double the business over the next two years. I helped the supplier share more of its needs and what it might take to achieve more investment. In the end, the parties agreed on a joint plan that would double the business, reduce costs, and provide for joint investments. Both parties have since greatly benefitted from the arrangement.
In another case I helped resolve through mediation, a brand had accused a retailer of copying its designs. The brand was about to file a multimillion-dollar lawsuit that would cost both sides hundreds of thousands in legal fees, not to mention any payout or settlement fees. Working with both sides to understand their needs and interests, and proposing possible solutions, I helped them agree that the retailer would make some adjustments in its designs, and they would work together to bring the brand into the retailer’s assortment. A win-win for both - at a very low cost.
At a time when retailers and brands seem to be more at odds than ever before, facilitation and mediation are two paths to creating joint value and impact. One might believe the parties could do this on their own by simply sharing more information with each other. However, there remains a level of distrust only a neutral can help resolve. To make it work, the parties must be willing to agree on a neutral facilitator they trust to respect their interests, understands the industry, and will keep information deemed confidential private. Naturally, both sides must be willing to equally share in the cost of the facilitator and mediator.
The time has come to consider these important processes for the sake of the ultimate consumer and drive continued profitable market share and growth.