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Tips on How to Improve Your Relationship with Suppliers

Many companies around the world rely heavily on suppliers to do their business. Purchased products and services allow these companies to perform activities ranging from exploration to delivery of goods to their consumers.

With such a reliance on suppliers, a good relationship with them makes perfect business sense. It is an essential factor that stems from a successful collaboration between two entities. A favorable relationship between a company and its supplier results in preferential treatment, which can lower costs and improve production in turn.

This is why maintaining a good relationship with your supplier is important to your business. The following tips will help you to improve your relationship:

Communicate Effectively and Consistently

Communication is important in any relationship, even professional ones. Creating efficient communication channels are of paramount importance. These allow internal and external teams to share information and documents that can facilitate easier communication and promote transparency.

Effective and consistent communication can also prevent issues and allow for faster correction should the need arise. Issues like incorrect orders, amendments, or delays can be easily communicated and resolved. In addition, suppliers are able to inform you about new products, services, and changes to their capabilities so that procurement can make better plans.

Communication should include discussion on any concerns or issues with supplier performance. This sends the message that you are encouraging their improvement and willingness to nurture the relationship.

Concentrate on Issue Resolution not Allocation of Blame

When issues are encountered, fault finding and allocating blame to the other party is easy. However, it is also a good way to ruin a relationship. When an issue is encountered, it’s best to prioritize resolving the issue instead of pointing fingers. Once the issue has been resolved, a discussion between the vendor and the customer should be arranged. This discussion should focus on determining the cause of the issue and establish processes and procedures to prevent a re-occurrence. A complete investigation of the issue should be done before any blame is allocated. This prevents ill will and promotes a sense of trust and respect.

Understand Supplier Capabilities

One way to ruin a relationship is by being overly demanding. Making rush orders haphazardly and basically thinking that your supplier exists solely for your benefit can quickly sour a good relationship. Be patient and understand that your supplier’s representative may be busy with other customers. It is reasonable to expect that they will be unable to take your order as they may not have enough stocks or resources for unplanned procurement.

Automate Procure to Pay Processes

Non-automated processes can result in fragmented information – missing or incomplete documentation – from both sides of the transaction. Not only will these deficiencies slow the procurement process, but it can lead to compliance infringements. Automated processes help ensure that documentary requirements are fulfilled and regulations are complied with.

Automation also makes complex processes more manageable and deliverables easy to track. It can also minimize errors during the procurement process. Automation helps ease the burden on suppliers and will make them appreciate you better.

While some of these tips require a change in culture and processes, others require the implementation of technology solutions. Automation of your processes can also be used as a communication channel, allowing suppliers and procurement officers to exchange information. The uncompromising nature of an automated process underpins transparency, which will lead to building trust.

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