Build strong supplier relationships
It pays to invest time in building good relationships with your key suppliers. If you can save money or improve the quality of the goods or services you buy from your suppliers, your business stands to gain.
How to build a good supplier relationship?
Here are some practical tips to help you build a good relationship with suppliers:
- Meet your contacts face-to-face and see how their business operates. Understanding how your supplier works gives you a better sense of how it can benefit your business.
- Keep in regular contact and update them on strategic changes or new products early on. This helps them to adapt and meet those changes.
- Ask about their plans for development or expansion. Will this affect the goods or services they're providing to you?
- Place orders in good time, be clear about deadlines and pay your suppliers on time.
- Make sure you have efficient systems for purchasing, stock control and payment procedures. See how to improve your supply chain efficiency.
- Keep an eye open for any business opportunities you can pass their way - in a good customer-supplier relationship they'll do the same for you.
- Make your business important to your suppliers and they will work harder for you.
Some suppliers may offer better deals if you promise to use them exclusively. However, keep in mind that this may cause significant problems if they go out of business. Don't ignore opportunities offered elsewhere. Keep your options open by monitoring the deals offered by other suppliers.
Use service level agreements (SLAs) to define expectations
Your SLA defines all the key metrics and commitments for your supplier. While they can take time and effort to create, SLAs can also help validate performance, manage expectation and improve communication. This, in turn, can help build a stronger, mutually beneficial relationship with your supplier. See more on supplier service level agreements.