Agricultural raw materials are the main ingredients used in ThaiBev’s production. ThaiBev is committed to sourcing high quality agricultural raw materials in an environmentally and socially responsible manner. These raw materials are the main components of alcoholic beverages, non-alcoholic beverages and food; namely malt, sugar, palm oil, tea leaves, coffee beans, and cocoa. ThaiBev aims to source 100 percent of these materials responsibly and in compliance with applicable local or international standards by 2030.
Due to the growth and dramatic expansion of the business
in the ASEAN region, ThaiBev’s supply chain has become
more complex and involves increasingly diverse suppliers,
which are not only ThaiBev’s direct suppliers but also the
suppliers of its suppliers. In 2017, ThaiBev initiated the
CROSS project with the aim of increasing supply chain
visibility and raising the standard of procurement by
focusing on fostering stakeholder collaboration, process
re-engineering, and online connectivity. The project
activities are classified into three dimensions, including
the professionalization of procurement personnel,
process improvement through automation and optimization,
the development of new technological capabilities that
allow for various systems to work in coordination,
transparent data accessibility, and better data analysis.
In 2019, ThaiBev introduced the CROSS Procurement
solution and connected it with the Supplier Life Cycle
Management (SLCM) system. Currently, the SLCM
system acts as the central interface between suppliers
and ThaiBev. It is here that a supplier can register with
ThaiBev, undertake their sustainability risk assessments,
confirm orders, and exchange documents online. The
CROSS Procurement solution will also play a role in
fulfilling the procurement process: the solution instantly
records the purchase of products and services that take
place throughout ThaiBev’s operations. This is to ensure
that procurement is fair, transparent and traceable. The
solution consists of four features:
is for the selection of potential suppliers by taking into account the environmental, social, and governance dimension as well as the supplier’s capability. CROSS Source connects with the Supplier Life Cycle Management (SLCM) system and covers the entire supplier qualification processes from the Supplier Code of Practice compliance, to supplier registration, supplier screening, supplier selection, and bidding.
is for contract creation and agreement with suppliers through a traceable and transparent system. It also covers contract compliance: managing the purchase of products in line with contractual terms.
is for purchase order issuance to, and confirmation with the determined suppliers and for purchasing products through eCatalogs (online product catalogs).
is for suppliers’ sustainability risk assessments which cover environmental, social, and governance dimensions, and other areas such as supplier credibility, financial liquidity, operational risk and negative media coverage that may affect suppliers’ reputation. The risk input is derived from third-party databases specializing in corporate risk assessment such as the World Economic Forum, Dunn & Bradstreet, GDACS and Semantic Visions.
In addition to developing its internal procurement processes, ThaiBev is committed to suppliers’ digital capability development through various activities which drive supplier engagement: CROSS Procurement solution training for its suppliers, promoting the solution adoption, hosting the annual business partner conference, and providing solution support services via the ThaiBev Procurement Service Center (PSC). These activities are in place to ensure that suppliers are able to do business with ThaiBev conveniently, quickly, and transparently, as well as enabling suppliers to grow together with ThaiBev sustainably.
| Internal stakeholders | External stakeholders | |
| People | Professionalize | Collaborate |
| Process | Optimize | Simplify |
| Technology | Integrate | Centralize |
The adoption of the CROSS Procurement solution will enhance ThaiBev’s data accessibility with greater accuracy, increase data analysis capabilities, assist ThaiBev in decision-making and formulating strategies for procurement, and enable ThaiBev to manage risks more efficiently and in a timely manner. In addition, the solution focuses on collaboration and information exchange between ThaiBev and its suppliers in order to maximize efficiency in supply chain management. At the same time, the system increases the quality of ThaiBev’s procurement services for internal users, responding to their needs instantly and supporting the long-term sustainable growth of the organization.
Launched Supplier Life Cycle Management (SLCM)
Kick-Off CROSS Project
Opened ThaiBev Procurement Service Center
Upgraded the
SLCM System
Developed the
CROSS
Procurement
Extend CROSS Procurement solution to domestic non-alcoholic beverage and food businesses
Extend CROSS
Procurement solution
to international businesses
Develop global strategic
sourcing plan
Initiated in 2016, the Business Partner Award is a program
for promoting supplier capacity-building, stimulating
business competition, and spurring industry innovation.
The award-winning business partners are those with
excellent operational standards and are leading models
for sustainable business practices for other partners.
This year, over 150 business partners consisting of
manufacturers and service providers participated in the
award program. The participants comprise partners from
various industries, such as packaging, commodities and
promotional goods.
In 2019, ThaiBev presented the Sustainable Collaboration
Award, a distinctive award under the Business Partner
Award program, to partners who collaborated with ThaiBev
and other stakeholders in initiating projects with the aim
to create a sustainable supply chain. The Business Partner
Award Committee selected the winners based on the
quantitative environmental, social and governance
benefits arising from the projects and the number of
stakeholders gaining such benefits. This is in line with
ThaiBev’s business practices that aim at “Creating and
Sharing the Value of Growth for a Sustainable Future.”
Roadmap
ThaiBev realizes the importance of engaging with business
partners, who are crucial in steering business towards the goals
of ThaiBev’s Vision 2020. The ThaiBev Business Partner Conference
2019, which is part of a two-day ThaiBev Sustainability Day
2019 event, has been arranged with the objective to communicate
ThaiBev’s steadily and business direction, both short-term and
long-term, to its partners and help them seize opportunities to
grow steadily and sustainably with ThaiBev. The event also provides
a stage for ThaiBev and its business partners to exchange insights
as well as goals and challenges related to the dynamic of consumer
behaviors, and to keep pace with sustainable development goals.
At this year’s event, ThaiBev launched the“Thailand Supply Chain
Network” (TSCN), in collaboration with its strategic business
partners, with the aim to establish intercorporate relations
among Thai companies. Through TSCN, companies will be able
to exchange information, share experiences learned from their
investments as well as operating businesses overseas. This
knowledge will assist Thai entrepreneurs to strengthen their
supply chain and thus, allow them to be able to expand their
businesses to different markets.
Set standards for the procurement of agricultural raw materials that are the main raw materials used in the production process, namely malt, sugar, and palm oil in accordance with internationally recognized standards such as Bonsucro, RSPO, and SEDEX to ensure that raw materials are carefully selected through socially and environmentally responsible procurement processes.
By performing on-site audits at suppliers’ facilities on a regular basis, particularly the Critical Suppliers including non-substitutable suppliers, high-volume suppliers as well as suppliers exposed to high risk (suppliers without adequate environmental management or whose employment practices are not in line with the universal standards). Both internal and independent verifiers take part in the audit: for instance, production process inspection, safety and hygiene in product storage, and product transportation. In addition, the audit process examines the sustainability of suppliers’ business operations, such as waste management, labor practices, employees’ occupational health and safety. The risk database from independent organizations that are internationally accepted, such as the World Economic Forum and CSR Risk Check, are also used to assess sustainability risks that cover all risk dimensions. Currently, ThaiBev has assessed 100 percent of its Critical Suppliers and high-risk suppliers.
ThaiBev collaborates with its Critical Suppliers to assess non-tier 1 suppliers, especially the suppliers of critical materials, in order to manage end-to-end risks throughout the supply chain. ThaiBev regularly liaises with key suppliers to exchange information about risks of non-tier 1 suppliers and may assign ThaiBev’s personnel to participate in non-tier 1 supplier on-site audits alongside critical supplier auditors to properly identify and mitigate potential risks in the supply chain.
