Vittia Annual Report 2022

VITTIA Purchasing and supplier management GRI 2-6, 3-3, 204-1 Our operations and purchasing processes are divided into two main groups of supplies: raw materials and packaging. In this context, we have established specific procedures for contracting and purchasing national and international suppliers. Purchasing and storage planning has significant impacts on our operations, due to the seasonality of the markets in which we operate. As around 30% of our raw materials are imported, any change that occurs in the external scenario or in maritime freight, affecting availability and prices, reverberates in our operational activities and in our production. When purchasing from international suppliers, the majority of raw materials are commodities, with market prices. In order to carry out purchases, approvals are required proving the integrity of the Company in terms of quality standards, socio-environmental aspects, and delivery capacity. As for purchases from national suppliers, we carry out two types of purchases: ► Product purchases through contracts. These contracts are made for products with greater demand and which are more representative within the Company's portfolio, in addition to basic items such as MRO (Maintenance, Repairs and Operations) and PPE (Personal Protection Equipment). ►Spot purchases. In this modality, non- recurring items are purchased or for issues or situations that are not needed or in which it is not possible to enter into longer contracts. Market quotations are made and a supplier registration process is carried out. Even in these non-recurring purchases, suppliers are checked in terms of the company's integrity in ethical, socio- environmental issues and quality standards. With regard to inventories, we have strict control, through the regular carrying out of inventories for control purposes, in addition to adequate operating systems and dedicated employees for these functions. One of our differentials is the ability to work with low product loss rates in the stock of products without turnover. In 2022, we reviewed and readjusted the structure of our Supply Sector, focusing on continuous improvement. In addition, efforts are being made to systematize a supplier self- assessment process (including sustainability/ ESG criteria). Annual Report 2022 94

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