Suppliers Need Water and Care

Categories : Procurement Stages | Identify Suppliers | Negotiate | Reduce Risk Published on : Jun 01 2018

By: ProcurementIQ Staff Writer, Ashley McKay

This week, we came across an interesting metaphor to help explain supplier relationship management. In general, we know that properly managing relationships is a critical part of the job for procurement. However, vendor management is not always high on the list of priorities. And, engaging with suppliers usually becomes a very transactional process.


In her article, "Garden Full of Suppliers", Alison Smith compares garden care to supplier management. Here is one of the metaphors Alison uses:

Lawns Need Mowing and Lawns Need Weeding

“The power of the metaphor is realising suppliers also need mowing and weeding - just like that long tail of suppliers that needs to be reduced,” says Alison. Supplier consolidation is a major part of supplier relationship management. And, to build effective and efficient relationships, sometimes the first step will require cutting out the ones that are not providing true value to your organization.

How does consolidating lead to better supplier relationships? For one, it’s much easier to build and maintain relationships with a smaller supply base. This translates into greater transparency. You’ll be able to make sure that vendors, across the board, are meeting business needs and providing good value and high quality.

Consolidation can even lead to better negotiation terms and greater cost savings. For example, you may be able to identify vendors that offer multiples goods and services you purchase, and receive bundling discounts by purchasing with that one vendor.

Click here to read Alison’s full article.

Here’s one more we’d add to the list: Water and Care

To get your relationship to where it needs to be and ensure that your vendors are providing value to your business, you must water it so it can grow. With such busy schedules and other high priority business initiatives to meet, it can often be difficult to make time to maintain relationships with a supplier after the contract is signed. However, cultivating and nourishing the relationship can only lead to better transparency, stronger relationships and stronger supply chains.

 

For more on supplier relationships, read
How to Consolidate Suppliers and Reduce Costs



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