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How to Effectively Manage Supplier Relations

There are countless businesses that rely on suppliers to help their company work on a day-to-day basis. From sales companies to manufacturers, without good suppliers they won’t be able to function.

For this reason, it is incredibly important that companies choose to work with only the best supply companies that will meet their needs. Once your business has agreed to work with one or more sets of suppliers, the next step is ensuring that a good and effective relationship is forged. Managing supplier relations is a key element, and some businesses may employ a supplier relationship manager whose main responsibility this is. Maintaining a good relationship will help both businesses run smoothly, and there are a few things to do to make sure this happens.

Understand The Supplier’s Business

The more you know about your supplier and how they operate, the easier it will be to form a good supplier relationship. It is important to understand that they will have other clients, so won’t just be focusing on your company.

This will also make it easier to understand should there be any problems with the supply chain. Plus, the supplier will be a lot more appreciative that you have taken the effort to learn about their line of business.

Open Clear Communication Channels

Communication is key within any relationship, to ensure proceedings run smoothly and if there are any problems that they can be relayed simply. In the early stages of your supplier relationship, invite them to your workplace, introduce them to important players in your business and invite them to strategy meetings, where appropriate.

Share information about new offerings you will have and invite them to any events too. The most important aspect is to ensure they are well informed about any changes or other important bits of information that will affect your working relationship.

Meet Deadlines

There’s nothing worse for a relationship than letting the other party down. In order to demonstrate to suppliers that you are a good customer, meet all their deadlines and other expectations.

This will make you look good in their eyes, and ensure you meet any deadlines included with the agreed supplier contract. It is an easy way to build up good relations, full of trust, and an essential part of supplier management. Deadlines should be included in the supplier strategy and calendar to ensure they are known about well in advance.

Set Clear Expectations

The best supplier management strategies are those which set out clear aims for the suppliers to meet, and that are easily achievable. Depending on the size of your business, you may rely on anywhere from one or two suppliers, to hundreds of different ones, which is a great option for supplier risk management.

As part of a clear communication plan, regular meetings, whether in person or over the phone, should be set up so everyone is aware of what the agreed expectations are. It will also bring attention to any failings in the supplier relationship management that need amending to improve the process.  

Use SRM Technology

There are various instances of supplier relationship management software available, to help the supplier relationship manager of your business stay organised. These are especially useful for companies which rely on numerous suppliers to help their business run smoothly.

With increasing numbers of suppliers, it can be hard to keep track of them all. Such software helps in this respect, providing information about each one, as well as being used to track performance levels and more.

Help Each Other

The supplier relationship should be a mutually beneficial one. Treating your suppliers as partners can lead to greater successes for both, such as passing along any business opportunities that may interest them. The gesture may well be returned, and given the different range of clients both businesses will have, it can open up many fresh and exciting opportunities that would be otherwise missed.

These tips should help improve your supplier relationship and effectively manage proceedings. If after implementing all these points you still come up against obstacles, then it might be time to consider changing supplier.