Eight Critical Keys to Successful Vendor Management
The vendor relationships you cultivate are crucial to your success, as these are the partners you'll rely on repeatedly for critical services. Managing these relationships effectively will ensure your operations run smoothly and your business stays productive and competitive.
Here are eight key tips for maintaining successful vendor relationships.
1. Choose Carefully
If you're fortunate enough to have multiple options, take care to examine the benefits and drawbacks of each vendor you're considering working with. Who can get you what you need and when you need it? Is the price competitive with other similar vendors? What are their contract terms? In addition to answering these questions, look for a vendor who can adapt and grow alongside your small business.
2. Get to Know Their Business
Although it's not critically important to understand every moving part of a vendor's business model, it does help to learn some of the basics. General knowledge about their policies and practices will help you learn more about their business values and how well they align with yours. You’ll also learn about the kinds of challenges they face, which can help you evaluate if they have the speed and flexibility needed to serve your growing operation.
3. Have A Contingency Plan
Even the most reliable vendors will experience issues that can interfere with their ability to get you what you need when you need it. Shipment backups, inclement weather, and equipment failure are all unforeseen disruptions that can and will affect your supply. Be reasonable with vendors experiencing these kinds of issues, and make sure you have an agreement covering how they'll handle things on their end should problems arise.
4. Rewards Are Just as Important as Penalties
When a vendor fails to uphold the terms of your contract, a penalty is an unfortunate but necessary measure to protect your small business. However, you should be just as ready to reward excellent work. If a vendor goes above and beyond to exceed your expectations, make sure you acknowledge their effort. A thoughtful “Thank You” note goes a long way toward maintaining a positive and productive relationship with a great vendor. Sharing your appreciation will help build a positive relationship!
5. Take Responsibility for Your Part
When business doesn’t go as planned, it’s easy to point fingers in the direction of your vendors. As a client, however, you are just as responsible for the outcome of those business interactions. If you change the timing or scope of a project and it disrupts a vendor’s ability to meet your expectations, accept accountability for your role in the delay and move forward with your relationship.
6. Consider Supplier Management Software
As your business grows, so will the list of vendors you work with. When this becomes too much for you or your office manager to handle alone, it might be time to invest in supplier relationship management (SRM) software. This software keeps all vendor information secure in one easily accessible platform. Depending on the software you use, you can also monitor vendor performance and interface with accounting software to streamline your invoicing. Make sure you have reliable Business Internet to support a SRM.
7. Be Flexible
Adapting to change is key to maintaining great working relationships with your vendors. If something small comes up that impacts your supply, set aside some time to handle it together with your vendor and keep business moving on both ends. If you notice a vendor struggling to adjust to a changing business environment, try to learn more about the situation before dropping them. Good vendors aren’t always easy to come by, and it’s worth the effort to keep them around.
8. Stay in Touch
A lack of communication can end any relationship; the same is true for your vendors. Maintaining excellent lines of communication will guarantee your relationship stays productive. If a timeline changes, for example, a prompt video call can help your vendor troubleshoot and make the necessary changes to keep things moving.
Staying in touch requires adaptable Wi-Fi and phone communications. With a variety of plans and options available, including dedicated fiber internet guarded by Sparklight’s Internet Service Protection, you’ll never have to worry about slow speeds or unexpected outages getting in between you and your vendors. Contact us today to learn more.