If you run a business, then you probably have a number of suppliers that you work with. Successful supplier relationships can have an extremely positive effect on your business, but they are often overlooked as just a basic part of the procurement cycle.
Not only is it good practice, but it can lead to preferential rates and discounts and business referrals.
If you’re looking to enhance your supplier relationships and performance, then here are some tips:
Don’t fall into the trap of thinking that because you are buying from a company that they are there to do whatever you ask, whenever you ask. Respect that you are both in business and that the relationship is mutually beneficial. Suppliers such as clintonaluminum.com work with a variety of industry sectors and build relationships with each of them in this way.
If you act in a heavy-handed way, this will create animosity with your supplier and they will not go out of their way to make you a happy customer.
If there are any issues that arise, then discuss them early and openly. Often, things can be resolved very quickly and you can avoid the relationship deteriorating to a point where it cannot be salvaged. By doing this you’ll be able to run your relationship based on trust rather than defensiveness.
This is true for pretty much all areas of business and life. Clear, regular communication is the key to good supplier relationship management. Simply going radio silent until you need something is not the way to build a mutually beneficial relationship going forward.
Without clearly defined contractual responsibilities and performance expectations, you leave a lot of room for disagreement and misunderstandings. If you feel your supplier is underperforming, you need to have something tangible you can point to rather than just your interpretation. Your contract will document what each company has agreed to. This can be timescales, quality of goods, pricing and delivery.
Use this contract as a framework for regularly performance meetings.
You should always strive to act ethically and professionally. Don’t behave unprofessionally, avoid phone calls and emails or pay you invoices late. You can’t expect them to go the extra mile for you if they think that you only talk to them when you need them to do you a favor.
If you’re following all of the basics of supplier relationships management and you find that you are not happy, then it might be time to look for a new supplier or managed service supplier. If they are not fulfilling their contractual obligations and you have been unable to resolve this through performance management, then you are within your rights to end your supplier relationship.
This can be a difficult thing to do, especially if it is not something you have dealt with before. Try and keep it as professional as possible, as you never know when you will cross paths with the company, or account manager again in the future.