Adopting a structured approach to ensuring production continuity is key to making the due diligence process more manageable and ensuring efficient EUDR compliance. It ensures that key products are prioritized, helping to maintain a continuous production of your company’s goods. There are several product based supplier sampling approaches to ensuring production continuity which you can take to effectively manage your product-based supplier sampling, especially when starting out.
PRIO 1 - Prioritize Key Products
Begin by identifying the most critical products for your business, particularly those that are purchased recurrently. For example, if an automotive manufacturer uses the same components across multiple car models, these parts and their respective suppliers should be prioritized. As these items are essential not only for the production process but also for the final product, focusing on them early will help ensure that key components are addressed effectively.
PRIO 2 & 3 - Focus on Priority Orders
Start by concentrating on orders from the first quarter, particularly for products that are regularly purchased and crucial to the production of your final products. Next, prioritize replacement orders for Q1, which are products that are currently in stock but will need to be replenished by a specific deadline. Lastly, focus on Q2, Q3, and Q4 orders that are essential but can be procured at a later stage.
Knowledge - Building Approaches
Focus on Mature Suppliers First
Another option for supplier sampling is to start with established suppliers. If you know of a supplier that is already EUDR ready, meaning they have a Due Diligence System in place and can provide Due Diligence Statements, it makes sense to prioritize them. Since established suppliers are likely to meet the necessary requirements more quickly, this approach can serve as an educational strategy, providing you with a foundation for understanding how EUDR compliance is achieved.
Define a Smaller Scope
If you don't have specific high-priority parts, you can narrow your focus by region. Focus on two countries within the EU, where your key suppliers are located. From there, you can assess suppliers from non-EU countries in these regions. Once you’ve addressed these, expand your focus to all EU suppliers, and finally, as the last step, tackle non-EU suppliers from all regions to ensure a comprehensive supplier management process.