- Tags : Vendor Relationship Management | Supplier Relationship Management | Supplier Optimization | Vendor Consolidation
By: ProcurementIQ Staff Writer, Savannah George
Successful purchasing relies on effective suppliers. With ongoing evaluation of your supply base and replacing average vendors with better ones, you’ll improve the process and benefit from increased efficiencies. To do this, it’s important to create an evaluation method, performance indicators and a vendor classification system based on how critical they are to operations.
By consolidating spend and contracting with a limited supply base to serve needs across the company, you’ll likely receive more favorable terms and reduce time spent on negotiating and renewing numerous contracts. Over time, a supply base tends to grow naturally, so activities like creating a quality-and-delivery threshold and purging dormant or inactive suppliers will ensure a highly capable supplier base at manageable levels.
Here are six steps to get you started on the path towards a smaller, more efficient supply chain.