Underwood to speak on partnership, Kmart at SPARC - K Mart Corp. Sr. V.P. Bill Underwood, 16th Annual Supplier Performance Awards by Retail Category dinner

Discount Store News, July 19, 1993 by Laura Liebeck

CHICAGO -- Kmart's senior vice president, general merchandise Bill Underwood, will address the hot topic of partnerships between retailers and manufacturers during his remarks as master of ceremonies at the 16th Annual Supplier Performance Awards by Retail Category (SPARC) dinner Aug. 15.

He'll even sprinkle in some personal remarks on the subject concerning Kmart.

"The time of SPARC [last year] was a starting point of some strong commitments to not just partnerships but strategic partnerships with everybody in the industry," he said. This year he will gear his presentation to focus on a future development in partnership.

This year's SPARC awards program is the second Underwood will attend as master of ceremonies. Last year, he took the podium and talked about the need and importance of partnerships. "We're making good progress," he said.

The annual awards ceremony is hosted by Discount Store News. This year's program will be held at the Marriott Downtown Hotel in Chicago Sunday, Aug. 15. Festivities will begin with a cocktail party at 6:15 p.m., followed by dinner at 7:15 and the presentation of the 1993 SPARC Awards.

SPARC awards are presented in 22 business categories to suppliers who have developed outstanding merchandising programs that meet the special needs of discounters.

In addition to first, second and third place awards to vendors in individual merchandise categories, special awards will be given to Robert Ulrich, chairman of Target Stores, who was voted Full-Line Discounter of the Year, and to Wolf Schmitt, president and chief executive of Rubbermaid, for Vendor of the Year.

Awards also will be presented to Raymond Zimmerman, chairman of Service Merchandise, who is being inducted into the Discounter Hall of Fame, and to David Fuente, chairman and ceo of Office Depot, who will be presented with the Specialty Discounter of the Year award.

Underwood, who is completing his second year as chairman of DSN's SPARC committee of retail executives, noted that partnership is an appropriate topic for discussion at the awards banquet. Strong partnerships, he said, provide a "competitive advantage" for both the retailer and the manufacturer.

At Kmart, Underwood said the giant discount chain recognized the consolidation in both the retail and vendor communities and the increasing pressure to "satisfy our customers. Partnerships help that greatly and it helps with quality. Quality continues to be an important part of price and value today. Everyone is working on everyday low price. Customers aren't looking for that, they expect it."

To provide customers with what they expect, a genuine sharing of information is vital, he said. A consistent review process also is necessary "or you'll lose ground," he said.

SPARC, Underwood noted, provides retailers and vendors with an opportunity, in a more relaxed setting, to meet the managers of their partnerships. These more casual meetings permit greater insight into the strategies behind the programs.

Kmart is investing a lot of money with its suppliers and distribution systems through partnerships with the goal of making both companies more profitable, said Underwood.

"We're stronger, more committed today than we ever have been [to partnerships]. Throughout the industry it's something we're continuing to encourage in our supplier bases. The suppliers and retailers must continue to talk about the common benefit: new product introductions and how fast you can get to the market," he said.

Partnerships, Underwood said, have broken down the wall of secrecy between retailer and vendor.

"Who would ever have thought that we would share our POS [Point of Sale] information? Once we understood its importance, it's happened," he said.

In the last two to three years Kmart has seen a "new focus," Underwood said. Vendors who weren't involved in partnerships now ask for them. Others who have been in partnership with Kmart are looking for ways they can be more effective.

"I think everyone now realizes how hard it is to have a good partnership," Underwood observed. "It's not all fun. You run into some major roadblocks--to understand the systems and philosophy."

Underwood said his own involvement in partnerships with vendors has improved over the years. He said he tries--time permitting--to meet with presidents of different manufacturers to walk through a Kmart store to let them talk about what they are doing with product assortments. "And they'll talk about assortments, sizes of packaging, facings, overskus; it's another perspective. They also have the opportunity to review why we're taking different directions."

Underwood strongly believes that a well functioning partnership program needs to include more than top-level executives. He feels that the next step of partnership is for the buyers to get involved, a tough goal in an industry that is generally time-poor.