COMMERCIAL AND SUPPLY MANAGEMENT

The customer is at the centre of all the decisions we make about our products. We seek their safety, their satisfaction and their loyalty through a product of the highest quality, 100% safe and totally adapted to their needs through our Technical Assistance Service. To this end, we pamper the product from raw material to final delivery to the customer, placing emphasis on continuously improving our production processes to make them ever more efficient and responsible. It is important to feed millions of households around the world but it is even more important to do so in a responsible and sustainable way.

OUR COMMITMENT TO SUSTAINABLE DEVELOPMENT GOALS
	Zero hunger   • We ensure the production and distribution of an essential ingredient for millions of households around the world, in a backdrop of huge restrictions and difficult movement due to COVID. • Our portfolio includes products adapted to Islamic regulations (Halal) and Jewish regulations (Kosher), considering the specific cultural features of our customers. • We also manufacture products of vegetable origin for vegans and vegetarians. • We design sustainable products that help to avoid food waste. • Through our products, we provide more efficient and sustainable cold meats manufacturing processes, contributing in the long term to meeting the growing demand for food.
	Responsible production and consumption   • We promote energy efficiency throughout the value chain, developing packaging that minimises waste generation - such as gas emissions and wastewater generation, among others - during manufacturing and subsequent processing. • We have food safety and quality certifications. • Our production policy in proximity through a production presence of up to 22 factories, contributes to reducing the impact of transportation on the environment.

The Viscofan Group places the customer at the centre of its operational decisions, continuously trying to provide him with the best value proposition in order to strengthen efficiency and have a greater diversification in the product and maintaining strict quality and food safety controls. We offer the highest quality in our products and services through:

• Product range  
• Approval of suppliers
• Renowned customer technical assistance service  
• Sound product safety and food hygiene system
• Evaluation of customer satisfaction

PRODUCT RANGE

We offer the widest range of products so that the customer can choose the casing that best suits his needs. More than 14,714 product lines were sold in 2020.

Viscofan, as the world leader in the production and distribution of casings, is the only company that manufactures products in the four main artificial casing technologies: cellulose, collagen, fibrous and plastic casings. In this regard, we take maximum care over the raw materials that we use, ensuring that we maintain the highest food health and safety standards in all production phases, carefully seeking a more sustainable solution in the transformation of our products, adding vegetable casings in 2019 to meet the demand for new areas of interest in vegan and vegetarian products.

In a context in which consumer habits may lead to the use of non-sustainable materials, at Viscofan over 84% of income originates from natural, biodegradable or recycled material casings. Likewise, helping our customers to achieve greater sustainability in their production processes, providing them with products with greater production efficiency leading to less food waste and which also enable the reduction of direct CO2 emissions during their processing. Our product categories are as follows:   

In addition, Viscofan also markets machinery solutions with the aim of making it easier for our customers to use our casings. These machines have been designed for casings for which the meat machinery market does not offer adequate solutions due to their special application

SELECTION OF SUPPLIERS

The Viscofan Group is committed to its suppliers and establishes relationships with them based on respect and trust in the quality of products and services, and on a reciprocal growth and learning opportunity.

This is a commitment that we understand must be mutual and that globally links to all employees of the organisation in the use of best practices in product purchase management and in any other service contracted.

The purchase of main (cellulose, collagen, abaca paper, polymers) and auxiliary raw materials (those used for chemical transformation, such as glycerine and caustic soda, among others) represents 39% of the Group’s total consolidated raw material consumption cost (37% in 2019).

Viscofan uses raw materials requiring different types of containers. One part of them is reusable, such as containers that store collagen skins and another part is biodegradable and is recycled, such as the boxes that contain the cellulose paper and, to a lesser extent, other containers are of a synthetic origin, for which Viscofan promotes their recycling as far as possible.

Due to the production characteristics of our main raw materials, in terms of our supply chain, there is a low risk of trafficking in human beings or of slavery. However, Viscofan, as a signatory of the Global Compact, requests a series of conduct requirements from its suppliers, in line with our human rights policy and our commitment to decent work and the eradication of child labour  

In 2020, it was expected to implement a system to monitor suppliers, which could not be carried out due to the travel limitations and restrictions imposed as a result of the pandemic. At Viscofan, we are aware of the strategical importance and impact of an adequate supply of raw materials and services for the whole organisation, together with the optimum management of the supply chain. Thus, in the so-called “first wave” of the pandemic, one of the main challenges that it was necessary to face was that of salvaging deliveries: both of customers and suppliers. With respect to the latter, the main obstacle between April and June 2020 was the lack of availability of collagen, due to the stoppage of the car industry on a global basis, causing the tanneries to reduce their activity to a maximum and to cease to supply collagen. Faced with this difficulty, Viscofan’s R&D teams succeeded in developing alternative channels to extract collagen from animal skins, which contributed enormously to avoiding that our production of casings with this raw material was affected.

Viscofan has established a supplier approval system that ensures nondiscriminatory treatment in the selection processes of suppliers and contractors, while seeking to ensure their compliance with quality, safety and cost criteria. In addition to this commitment, Viscofan expects suppliers to be innovative and efficient, to meet the legal and functional requirements, as well as the ethical practices required. In this sense and in accordance with our code of conduct and with our human rights policy, Viscofan rejects any type of child labour and, in accordance with this, our suppliers are asked to make a commitment similar to that included in our code of ethics.

In particular, our approval system for suppliers of raw materials and packaging includes a declaration of conformity on their performance commitments in accordance with internationally accepted ethical principles and human rights. In 2017, all companies of the Viscofan Group began to request this commitment in the   area of human rights and environmental criteria from new suppliers of raw materials, and this commitment was ratified by all of them in 2020.

Specifically, all suppliers of raw materials, packaging and maintenance must approve an internal approval procedure comprising an on-site auditing by the quality team of Viscofan, or the completion of a questionnaire. In both cases, among other matters, the following systems are assessed: quality management (ISO 9001, IFS), food safety management in the case of suppliers of raw materials (FSSC 22000, BRC Global Standard, BRC Packaging), occupational health and safety management (OHSAS 18001/ISO 45001), environmental management (ISO 14001) and human rights management (UN Global Compact, BSCI). In the specific instance of collagen, the acquisition of animal hide (mainly cows) is required. In Europe this must comply with the European regulations of welfare of animals at the time of slaughter.

Likewise, Viscofan has the highest own production presence in the industry, enabling it to optimise the transportation of merchandise, both with respect to customers and suppliers. Through specialised transportation companies, it seeks the most optimum route to receive and distribute merchandise. Furthermore, Viscofan’s products due not require special conservation conditions  during the distribution process, leading the transportation expense of the whole Group to be less than 3% of sales.

In addition, the Viscofan Group’s activities in the countries in which it operates are geared towards value creation for all stakeholders, including suppliers. Thus, in 2020, the company allocated €472 million as a reflection of the distribution of value to suppliers of goods and services, with 54% of purchases of raw materials from local suppliers (56% in 2019), which favours the economic development of the communities in which Viscofan is present. In line with its economic importance, Viscofan has a solid anti-corruption policy, which includes the company’s commitment to fight against bribery and corruption, and establishes the dealings and commercial relationship with third parties.

In 2014, Law 31/2014 of December 3 entered into effect, which modifies Capital Companies Law with regards to corporate governance. It establishes that companies unable to present abridged income statements must mention their average payment periods to suppliers in their management report; these calculations must be based on criteria approved by the Ministry of Finance and Public Administrations, in accordance with guidelines established in the third section of the Second Final Provision of Organic Law 2/2012, of 27 April, on budget stability and sustainability.

In compliance with this information requirement, the payment period for the Viscofan Group during 2020 was 24 days (2019: 23 days), which is lower than the maximum established by payment arrears regulations.

The average payment period calculations were performed as indicated in the Resolution of 29 January 2016 was published, approved by the Spanish Accounting and Audit Institute, is applicable to the information concerning late payment to suppliers in commercial transactions.

^[1]  A local supplier is deemed to be that whose tax domicile is in the same country in which Viscofan makes its purchases.

SALES TEAM AND TECHNICAL ASSISTANCE SERVICE

Viscofan has the largest commercial network in the industry and the level of service of its technicians is widely recognised throughout the market. As experts in artificial casings, we are the only company in the sector that has its own technology in the main families of casings and therefore offers a global and integrated service to our customers, providing the casing option that best suits their needs.

Viscofan offers customers a Technical Support service, which is a competitive advantage and of great help to customers when deciding, from the wide range of casings, which one is adequate for the needs of each product. This work is of increasing importance because our customers are not divided by technology, but use various technologies for different products, depending on the degree of sophistication of the meat processor.

Some 49% of the income comes from customers that have bought products in the four main casing technologies. In a continuous improvement model, through multidisciplinary teams representing sales, production, and research & development areas, the Viscofan Group identifies the issues that cause most concern to the meat industry and analyses, develops and implements the related improvements.

Maintaining our leadership position in the global market in an environment as dynamic as the current one would be impossible without Viscofan’s excellent level of service and diversification; as a result of our presence in 19 countries we are able to offer suitable casing solutions to more than 2,091 customers in 110 different countries.  

PRODUCT SAFETY AND FOOD HYGIENE

In order to guarantee the excellence of products and services for both customers and for the end consumer at all times, Viscofan has a food safety system that covers all of these aspects: manufacturing facilities are built to food safety specifications, employees are trained in food hygiene and product safety, raw materials are tested for compliance with specifications previously agreed with certified suppliers, systems are in place to detect defective materials in the production system, pest control is implemented and policies are in place to monitor hazardous substances, personal hygiene and visitors.

These protocols configuring our product food safety and quality system are based on the following core principles:

• Viscofan has a hazard analysis and critical control point (HACCP) system in place. Hence, an inter-disciplinary team assesses every step of the production process to detect possible hazards (physical, chemical and microbiological pollution, including allergens), identify critical control points, establish relevant controls and take any required corrective action. The system is annually updated in line with any changes in the production process.

• Casings manufacturing is becoming more tightly regulated, in the area of food safety, by countries and supranational institutions, making up a growing and constantly changing battery of rules. This regulatory framework directly affects the activity of different production plants due to laws in the country of origin and requirements in the receiving countries, and internationally recognised standards. For this work it has a specific department of Patents and Regulatory Affairs.

• Viscofan operates a product traceability system that enables us to identify, at any time and in full detail, the history of every unit and even sub-unit sold, from receipt of raw materials to product use by our customers. In Europe, Viscofan fully implements a food traceability system under Regulation (CE) 178/2002.

• To ensure that our product safety and food hygiene systems comply with requirements, our production processes are audited internally on a regular basis. Our production facilities are also continuously audited by the health authorities, numerous customers and certification authorities.

What’s more, Viscofan has internationally distributed certifications for meat processors to endorse their suppliers and market their products in the main distribution chains around the world.

This year, due to the mobility restrictions linked to COVID-19, our teams of professionals – both corporate and local – have had to implement some of these processes by coordinating remotely, and to conduct most of their audits online. These new circumstances have undoubtedly represented a challenge, which our teams have dealt with and managed superbly.

Certificates that prove the organisation’s commitment to product safety, health and quality at its work centres as well as in all the activities carried out around the world are shown below:  

The Viscofan Group also has Halal and Kosher certifications. These certifications, referring to food products, are based on regulations that are key to servicing different markets and exploring new growth opportunities. The Halal certification is specifically designed for products sold in Muslim countries and Islamic communities, while Kosher certification is a requirement for food consumption by the Jewish community.

CUSTOMER SATISFACTION

In 2020, a year of enormous global difficulty caused by the pandemic, we can say with gratitude and recognition towards all our professionals, that we have managed to maintain the excellent level of customer care and service that characterises Viscofan. The impossibility of travelling to our customers throughout the world has moved us to seek other ways of being present and of providing them with the care and service they require at all times. This has proved the company’s ability to adapt and has earned us the trust of our customers. Customer satisfaction is, along with service quality and product safety, a fundamental objective for Viscofan. A commitment backed by what is reflected in an estimated 37% share of the artificial casing market that has placed their trust in our products in 2020.

  In this sense, the sales team has a satisfaction evaluation system that allows them to directly obtain the opinion of the customers by measuring mainly four parameters (Product Quality, Delivery Service, Economic Competitiveness and Technical Assistance). In the last wave of the survey, a total of 348 questionnaires were sent out and a result reflecting an 82 per cent satisfaction rate was obtained.

Likewise, Viscofan has a very comprehensive integrated complaints and claims system that facilitates dialogue and communication to record, identify, follow up and analyse any communication of dissatisfaction with the product or service provided by the Viscofan Group to its customers. It is a system of cross-sectional, continuous improvement in which the departments involved must analyse the cause of the dissatisfaction and provide the corrective actions that will be established in the organisation to avoid its repetition. Any dissatisfaction is analysed, making it possible to control both the material that  is returned as a result of the complaints and compensations paid to customers.  

In 2020, a total of 3,610* complaints were registered in our systems, including both service and administrative or product complaints, compared to 3,373 complaints in the previous year, and none were registered regarding customer data protection. A large part of the increase in complaints compared to 2019 is due to the increase in the volume and range of products and, also, to greater discipline and efficiency in the registration of complaints - especially those relating to technical and commercial management - which are more systematically registered and are added to those that are strictly speaking technical and for which the corporate management tool continues to be improved.

In addition, the Code of Conduct of the Viscofan Group establishes that “relationships with customers will be based on respect and transparency”. Therefore, commercial messages fall within principles of transparency and veracity where no subjective comparisons are made nor is information given when it conflicts with third-party rights. These procedural policies extend to all geographical areas where the Viscofan Group has a commercial presence. It must be highlighted that in 2020 no penalties or complaints were filed for breaches relating to marketing notices or to the labelling of products and services, nor were there any incidents related to violations of customer privacy or the loss of data.

In 2020, we received recognition for the Group’s sustainability commitment from one of the largest global food groups, Sigma Alimentación which, following a process of assessment involving the management policies and systems of approximately 300 non-meat suppliers in six diMenions of sustainability, including health and safety in the workplace, anticorruption, certifications, environment and the relationship with the community, Sigma wished to distinguish the “excellent performance” of Viscofan, awarding it the 2020 Excellence Prize for suppliers.   

* Does not include those third-party products converted and distributed by Viscofan Globus Australia and New Zealand.