Behind every successful business is a list of suppliers they rely on to perform. The success of the company is as much down to the suppliers as it is to the business; lengthy delays from a supplier can have a knock on effect on your customers. It is imperative that you have good supplier management systems in place so that your business can operate as intended. There are a few ways to encourage good supplier management.
Build up a Relationship
The key to good supplier management is maintaining a good relationship with them. Frankly speaking this is the best tactic with any sort of relations: with your customers, suppliers, colleagues or noisy neighbour next door. You and your suppliers should have a good understanding of each other’s operations and capabilities in order to have a good working relationship. Regular communication is therefore a must. It ensures information sharing about the other’s operations. This may be in the form of regular update meetings. Another way to sustain good supplier relations is to align your objectives with theirs. Although you are two separate businesses with different needs, seeing objectives from another perspective can make things as easy as possible for the both of you.
Monitor and Analyse for Good Supplier Management
As important as good supplier relationships are to supplier management, you need to combine this with facts and data analysis to get the best results. Supplier performance needs evaluation so consistency is maintained. At the same time, any fall in performance or quality needs following up on in spite of risking the relationship.
There are a few ways of implementing this. Firstly, monitor your suppliers and collect data on the speed of delivery, quality of goods, etc. This can easily help you analyse supplier performance, and can give them evidence for any lapses in quality you observe. Another option is to use supplier management software. This can perform more medial tasks for you, helping you communicate with your suppliers by informing them of any changes to your work, as well as quantifying their performance. Software can be a great way of managing many suppliers at once.
Both Companies Benefit
By treating your supplier as a business partner, both companies can benefit in a number of ways:
- Faster manufacturing – a supplier more involved with your company will be interested in maintaining the relationship by completing your orders quicker. If they are used to the requests of your company, they may also require less information for the order.
- Cost reductions – suppliers are likely to offer exclusive deals to companies they know well. This helps them move certain stock quicker too.
- Lower risks – companies in regular contact with a mutual respect for each other will fulfil certain orders better and quicker. Suppliers will have a better knowledge of a company’s needs and manufacture to a more suitable specification.
- Higher quality products – companies who work together closely can personalise their trade deals. A supplier who understands the company’s project will be able to provide them with the best hardware for the job.
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