The vendors you bring into your supply chain can make or break the quality of the product or service offered by the business. The penultimate link before either is offered to consumers, some may even argue that vendors are the most important part of total operations.
For this reason, getting the relationship with your vendors right matters just as much as managing company cash flow or motivating the team around you. The right advice, used alongside practical tools like a vendor management software, can mean the difference between a dwindling partnership or one that exudes confidence and security on both sides.
Vendor Management Tips
Finding the right vendors based on the needs of your business often involves a fair amount of networking. In the wake of the COVID-19 pandemic, many conferences and events designed to introduce businesses to suppliers and vendors fell by the wayside as soon as lockdown hit.
As everyone turned their attention to digital services to stay connected, many VMS providers (like Indeed Flex) reiterated that their software can be used to source new vendors remotely. This, in conjunction with the following tips, can lead to a mutually beneficial relationship between businesses and their vendors.
1) Automate your organisation
Automation can speed up business operations in multiple ways, leading to lower operating costs, faster ROI and higher levels of output. Doing so shouldn’t just apply to specific areas of the business and is a useful approach across every link of the supply chain.
Vendor management, for instance, can also benefit greatly from automation. Rather than using an offline system or a single spreadsheet, the correct tool for efficient management will take care of everything from quote collections and generating reports to even scheduling and processing repeat payments.
2) Communicate business priorities upfront
A good relationship with your vendors requires detailed, clear communication right from the first time you interact with them. If you’re able to communicate your priorities (and preferences) up front and detail the end goal of your operations, the vendor gets a clear view of what their role is in helping you get things there.
This does require a fair amount of transparency, but you don’t need to give your vendors uncensored access to all the internal systems and inner workings of your business. Do what you can to get the right information to them, encouraging them to share exactly what they need in order to do the best possible job.
3) Stay mindful about vendor challenges
The vendor management process may come with its fair share of challenges, but one of the best ways to navigate them is to step into your vendors’ shoes and consider what they might be struggling with.
The relationship will become a more authentic one by doing so and creates room to discuss the shared resources you can use to help make things easier for them. At the same time, they will be more motivated to deliver high quality work for your business. Walking a mile in their shoes may even be the one thing that makes renewing the agreement a no-brainer when the time comes.
4) Make vendors a formal part of the bigger picture
Although strategic business goals are often kept away from competitors and locked inside a digital vault, letting your supply chain partners know about the strategic goals of your business creates a sense of shared unity. This goes beyond just sharing short-term goals related to their roles. Communicate the broader vision with confidence and watch as motivation levels begin to increase.
Also consider inviting vendors to join for quarterly meetings not only to find gaps in operations, but also to ask for their advice on ways to enhance efficiency. This simple act makes everyone feel like part of a larger team, which may even unlock new areas for long-term innovation and growth.
Whether you run a startup, an established corporation or something in between, these principles for managing your vendors can be applied across the board. Effective vendor management may not be a simple process, but armed with the right tips and tools, it can be as uncomplicated and rewarding as possible. Striking the right balance could even transform the partnership into a sea of opportunities moving into the future.
