Every company wants vendors that benefit them through customer success, expansion and financial growth. But, very few companies are willing to put in the time and effort to improve their vendor relationships.
The companies that do put in effort, find steady financial success through a partnership with their vendors. So, what makes the key difference? What can a company do to indulge in a partnership as opposed to just a supplier-business relation?
Well, here are seven ways to develop a strong vendor relationship.
Be Clear About Expectations
As a company, you have a certain set of expectations from your vendors. To avoid confusion, it’s a good practice to clarify what they are with. Be clear about your vendor expectations with regards to timeliness, quality, pricing, communication, customer service and more. And, ask your vendors to be clear about their expectations.
So how does it help with vendor relationship? Well, when your company and vendors share their expectations with each other, it informs both parties of their strengths and weaknesses. In turn, it gives you perspective and lets you set goals accordingly.
Make an Effort to Know Your Vendors
The hallmark of a positive relationship is getting to know the other. In a similar vein, fostering a positive vendor relationship requires you to spend some quality time with your suppliers. When both of you take the effort to know each other, you can indulge in knowledge sharing and give pointers and suggestions to each other. After all, it takes two to tango.
Meet your vendors socially, as a group or individually, and talk to each of them. A formal dinner or drinks at a nice restaurant is always acceptable for a formal meetup. However, if you want to do things differently, take them golfing or to a bowling alley.
And if you want to be completely whack about it, take them to a karaoke place or a paintball arena, and show them how much fun you can be. Nothing helps more in forming stronger bonds, than a healthy dose of competition.
Help Your Vendors Expand Their Business
Your relationship with a vendor is symbiotic- both gain when one succeeds. Help vendors in getting a steady stream of business and update them about potential leads that they could pursue. Let them know of opportunities that could help them expand and grow their business.
Looking out for your vendors and helping their business is a formidable step in forming a strong working relationship with your vendors.
Invest in A Vendor Management Software to Simplify
Investing in a vendor management software helps in keeping a track of all vendor related information in one place. With a vendor management software, you can create, administrate and track purchase orders with your vendors. This lets you keep a systematic tab on your vendor’s performance, while making the process easier.
Our Pick: Jikishlove Vendor Management & Vendor Portal are excellent vendor management solutions for your enterprise.
Give Vendors A Chance to Solve Their Problems
If you have issues with a vendor, don’t just abandon them and jump ship. While replacing people might seem easier, give vendors the ability to correct their problems. Your vendors are people too and people make mistakes.
You can help them improve as well and provide the resources they need to be better. Investing this level of effort and giving them the time to be better will only benefit your relationship with the vendor as it will foster a relationship that’s based on trust and respect.
Timely Payments Are Crucial
This is a no-brainer: if you wish to retain your suppliers, ensure that you pay them on time. Nothing sours a working relationship more than unreliability. It will also prove that you value your commitment to the vendor.
In case there’s a payment delay, inform the supplier on-time and give them a timeline as to when they can expect the payment. Vendors like their payments on time as much as you expect timely service on their part.
If you’re having accounting issues like managing expenses or keeping a track of finances, accounting software solutions like Tally and Zoho Books can help you easily match payments with invoices and reduce errors.
Maintain Documentation for Everything
Get into the practice of putting down everything in writing, when establishing a vendor relationship. Responsibilities, best practices, expected volumes, payment invoices, etc. should be always communicated in written form.
Make a habit of following up all verbal communication and requests, with e-mails and minutes of the meeting. This will help in avoiding any misunderstanding and miscommunication.
Forming a relationship with your vendor takes time and effort but with the right combination of tools, strategy and communication, you can have a mutually beneficial partnership.