Reducing Risk through Supply Chain Transparency

Q: How does Achilles help its clients foster stronger relationships with their suppliers?

A: A recent Gartner survey reveals that 87% of procurement professionals have attempted to change their purchasing models. One factor that has allowed us to mediate more effectively with these experts is the closer connection that now exists between the departments that oversee procurement and sustainability. Today, most professionals prefer to invest in projects that offer a high level of transparency and include a significant sustainability component. This has also helped us position ourselves better with our clients by providing assistance in minimizing risks and making their supply chains more transparent, which is crucial for us.

Q: How is your supplier portfolio divided in the Mexican market?

A: About 90% of our suppliers in Mexico worked in the oil and gas industry, but this percentage reduced after the incorporation of suppliers from other sectors. We noticed a growing interest in sectors like retail. The opening of new markets has allowed us to understand that these types of businesses, especially in terms of purchasing models, have a close relationship with a wide range of suppliers. This has helped us diversify our global supplier community portfolio.

At Achilles, each of our purchasing companies has access to a community of suppliers. By diversifying the number of buyers we have across different industries, the supplier base also becomes more robust. We significantly increased our supplier base in Mexico, growing between 30% and 35% in the last year alone.

Q: How does Achilles help its suppliers differentiate themselves, and what information do procurement teams value the most?

A: Companies are willing to showcase their strengths, but it is sometimes difficult to differentiate them. Many companies have professionalized their governance standards but do not know the best way to highlight these advantages. As a result, many resort to general terms when referring to their products, even though the real differentiator might be in their internal organization. Perhaps their relationship with clients is stronger, even if the products are similar.

Our software allows buyers to analyze different suppliers following an evaluation, providing a comprehensive comparison. Our platform also rates suppliers, assessing not only the quality of their products but also their internal systems and financial viability. Buying companies can make more strategic decisions by evaluating which suppliers best fit their purchasing policies. This approach allows them to make better-informed decisions and hire the company that best meets their needs. It also enables suppliers to present themselves more effectively and distinctly, aligning with market needs.

Q: How have your operations evolved in Mexico over the last couple of years, considering the nearshoring wave?

A: Many buying companies that have established their operations in Mexico have significantly expanded their operations. We want to take advantage of this trend  focusing  directly on how we can help those companies to keep benefiting from nearshoring. We aim to diversify the range of options we offer and reach those large companies that have come to Mexico to set up their operations.

Q: How are government regulations impacting your developments?

A: The regulatory framework on sustainability and supply chain transparency has been crucial, especially for companies looking to export to other countries such as the European Union. We have noticed that it has improved our relationship with companies seeking a partner to manage risk and ensure transparency in their supply chain. In the European Union and some countries in Asia, it is now mandatory to track traceability and "cleanliness" in the supply chain. This has benefited us because companies better understand our service. Three or four years ago, a service like ours might have been considered a low priority, but it is now a key priority.

Q: How does Achilles help energy companies comply with regulations? 

A: We play a crucial role in this area, especially in Latin America and Mexico. We are aware that there are companies that engage in illicit practices, such as child labor and irregular governance. In some cases, this is not due to ill intentions but because they did not know better. We want to help these companies stop operating in this manner and teach them how to make the necessary changes and take the steps to become more transparent and reliable for buying companies.

The Latin American market can be challenging, especially regarding transparency. There is a prevailing philosophy of avoiding scrutiny from private and public organizations. Our supplier development program involves communication and process implementation. Our approach with suppliers is to focus on improving their processes. We assist them so that, through our portal, they can identify gaps and gradually achieve compliance.

Q: How well established are Mexican supply chains and what do they need to become stronger?

A: Mexican supply chains are strong and highly resilient. We have established a control point with all our clients to provide metrics on the status of their supply chain, and we have noticed that a significant percentage renew our certification. This indicates that they have genuinely benefited from the commercial efforts of buyers through our services

In Mexico, buyers' policies have motivated some suppliers to acquire Achilles’ certification and some companies that have been certified by Achilles for years.

Q: How might the change in government and potential reforms influence the Mexican market?

A: We hope that the change in government leads to the recognition of the necessity of new energy sources. While they may not be accessible to everyone now, this transition can help companies improve their processes, reduce costs, and optimize their overall operations.

About 57% of companies, especially in Latin America, are considering incorporating green technology into their processes, according to a recent study by Capgemini. This includes logistical changes using AI to improve maritime or air routes, intelligent automation of production processes, or adopting sustainable practices such as adopting clean energy for warehouses or production centers. We now implement these technologies such as AI to improve document recognition & data validation. These tools had helped us to improve quality and customer engagement since its release.

Q: What are Achilles’ objectives for the Mexican market for this year and next?

A: Achilles grew by 8% in Latin America over the past year, considering a financial cut-off in April 2024. Our goal for the next year is to achieve double-digit growth. We are confident that we can achieve this goal through closer proximity to clients, a focus on local markets, and increased brand presence.

We consider the actual projects in the pipeline that can be considered a form of social labor. The more companies we manage to cover as part of our client base, the more we will impact the supply chain. We have grown significantly in the oil and gas sector and we are strongly venturing into lithium, renewable energy, and mining. However, the oil industry remains a key reference point for us and our hallmark in the global arena.

Achilles is an international consulting group that specializes in supply chain design and management through certification and auditing systems, with additional involvement in cybersecurity services, sustainability advisory, HSE management, and financial risk analysis.