Page 177 - CW E-Magazine (1-7-2025)

Special Report

What makes a ‘Customer of Choice’: Are pharma

companies & suppliers aligned?

n times of supply-chain uncer- companies are taking to becoming JIM MILLER
tainty, a new DCAT Research & Preferred Customers of their suppliers,
IBenchmarking report addresses a how suppliers are designating those Content Advisor, DCAT
key question in the pharma customer- ‘Customers of Choice,’ what benefi ts One possible explanation of this
supplier relationship: What does it take customers and suppliers receive from discrepancy is that the defi nition of
to become a ‘Customer of Choice’ and such efforts, and whether the expecta- ‘Customer of Choice’ varied widely
are customers and suppliers aligned in tions of bio/pharmaceutical companies among suppliers. When asked to pro-
their expectations? and their suppliers are aligned. vide their own defi nition of ‘Customer
of Choice’ some supplier respondents
Defi ning a ‘Customer of Choice’ The study addressed three main defi ned it as a strategic relationship, as
A simple defi nition of ‘Customer questions: we would expect, but others were more
of Choice’ is one provided by the man-  What criteria do suppliers use in transactional, even to the point where
agement and supply chain consultancy, designating ‘Customers of Choice’ ‘Customer of Choice’ is any company
Gartner: ‘A ‘Customer of Choice’ is one or ‘Preferred Customers’? they do business with.
that receives priority treatment when  What initiatives are bio/pharma
accessing the services or products of a companies taking to make them- ‘Customer of Choice’ criteria
provider’(1). The ‘priority treatment’ selves ‘Customers of Choice’ or The study showed that suppliers
customers expect when being desig- ‘Preferred Customers’ at their sup- consider a range of factors when deter-
nated a ‘Customer of Choice’ typically plier companies? To what degree do mining whether a customer is a ‘Cus-
includes: preferential access to capacity they have formal programs in place tomer of Choice’, but CDMOs and
and materials; closer collaboration with with their suppliers to evaluate their materials suppliers weigh the factors
suppliers for current and future needs; performance as a customer? somewhat differently (Figure 1).
and priority access to important inno-  Are bio/pharma companies and sup-
vations. pliers aligned in what constitutes a In delving deeper into the criteria
‘Customer of Choice’? used by suppliers, CDMOs use a broad
The ‘Customer of Choice’ concept range of criteria for determining whether
has gained traction as supply chain chal- Highlights of key fi ndings a customer should be designated a
lenges have shifted the balance of power The survey explored multiple as- ‘Customer of Choice’. Their most com-
in the customer-supplier relationship in pects of the ‘Customer of Choice’ monly indicated criteria, ‘Number of
the direction of the supplier. Buyers of relationship: Some highlights of the new opportunities presented to us,’ and
manufacturing inputs and services are key fi ndings are outlined below. ‘Revenues above a certain threshold’
keenly aware that having good relations were named by less than half of CDMO
with suppliers can be critical to ensur- Prevalence of ‘Customer of Choice’ respondents. CDMOs incorporated
ing that key inputs remain available and programs criteria that refl ected the closeness of
that their operations run smoothly. The The study found that suppliers claim the customer-supplier relationship,
rapidly expanding range of modalities, to have a formal ‘Customer of Choice’ including number of new opportunities,
formulations and delivery routes relies program, and most customers claim respect for their need to be profi table,
on purchased specialty materials and to aspire to the ‘Customer of Choice’ and willingness to involve the CDMO
services, so having close and mutually designation, but neither side seems in early product planning.
respectful relationships with the supp- focused on getting the most value out
liers of these key inputs and services of it. In particular, many suppliers said Materials suppliers similarly named
is critical to business success. their customers may not have been in- ‘Number of new opportunities presented
formed that they had been designated as to us’ and ‘Revenues above a certain
Probe into three main questions a ‘Customer of Choice’ while most bio/ threshold’, but by much greater mar-
The DCAT Research & Benchmark- pharma company respondents indicated gins while other criteria were less com-
ing Committee focused its 2025 study on that they do not make a proactive effort mon among materials suppliers. The
exploring what initiatives bio/pharma to become a ‘Customer of Choice’. results suggest that materials suppliers

Chemical Weekly July 1, 2025 177

Contents Index to Advertisers Index to Products Advertised