How can I improve supplier relationships?
A role in procurement involves more than just purchase agreements. Having a strong relationship with your suppliers is essential to maintain and develop your business’s growth. Working on building a good relationship with them should be as important as building good relationships with your customers.
Successful SRM improves efficiency, risk management and helps you gain better value for your business. The stronger your relationship with your suppliers, the more likely you are to benefit from special service, favourable pricing and generous terms. The benefits sound good, but how can you actually improve supplier relationships? Here are our tips.
Regular, open, two-way communication is at the heart of any strong business relationship.
Having the right communication tools in place can help procurement teams share vital information with suppliers quickly, so any disruptions can be minimized.
Communication is key for more than just handling potential problems and issues – it’s fundamental for creating a shared understanding. Staying in regular contact with your suppliers, even when things are running smoothly, is vital. Make an effort to personalize your relationship by visiting their offices or inviting them to participate in strategy meetings once in a while. By communicating regularly, you keep the positive feelings between one another, which comes in handy when it’s time to negotiate.
Bob Reiss also suggests keeping suppliers in the loop with key personnel and product changes to help improve supplier relationships.
2. Be transparent about your goals
An essential part of successful SRM is openness and honesty. Sharing information and being transparent increases your likelihood of reaching mutually beneficial agreements.
When it comes to your business’ goals, it’s crucial to be transparent about delivery timing, quality, and price expectations. Your entire relationship is built on your supplier’s ability to meet your goals, so it’s important to be honest and upfront about them.
3. Be a good customer
No successful relationship is one-sided, including the one between supplier and customer. If you want to improve supplier relationships, always keep in mind that they’re running a business, too. Your suppliers deserve a customer who pays on time, and is clear about their goals and any potential problems. Check out our post on how to be a better customer for more tips and advice.
4. Utilize technology
Technology has begun to transform the landscape of procurement functions. It presents new opportunities for businesses to improve upon existing processes, and innovate to increase efficiency and growth.
Utilizing technology is one of the most effective ways to improve your SRM. Software and programs with features like supplier profiles and performance monitors make it easy to manage multiple vendors.
Xpo-Online has been developed with the needs of procurement professionals in mind. We’ve developed Smart Tools for buyers to not only find new suppliers, but to improve supplier relationships with the Supplier CRM. Monitor supplier performance to work together to meet your goals. Track every interaction to make sure your communication is always timely and meaningful. Want to find out more? Click here to check out our features.
Improving your supplier relationships is certainly beneficial for your business, but it won’t happen overnight. We’d love to hear your thoughts, so if you have any tips or suggestions, feel free to leave them in the comments section below or on Twitter @Xpo_Online.