Vendor Management Strategy

FIFO

Below are some unpleasant statements our clients have brought up during meetings.

“The vendor who emails their quote last gets the order” This gives a whole new meaning to First in, first out!

“I don’t deal with purchasing people, I do business with James in engineering department”

“She’s supposed to oversee procurement in all 7 countries but she has no clue of what goes on”

“Many prequalified vendors have never been invited to submit a quotation’’

Listening keenly you see mistrust, lack of transparency and lack of information in the way vendors are managed. It is a challenge in many organizations.

Could the vendors be compromising purchasing teams?

Any answer is correct. There is inadequate information flow and to dig deeper could be too expensive, time consuming and severe relations in organization.

We are a team! Remember?

What can be done?

A good vendor management strategy backed with innovative technology will sort it.

A supplier management strategy ensures effective communication, risk management, bring down total cost and building long-term relationships.

Many organizations have a great vendor strategy on paper but teams have no tools of putting it in practise. A robust supplier relationship management (SRM) solution enables you to put it in action. SRM solution will facilitate communication, process efficiency, vendors into central database, avail data needed for spend analysis, all RFQ is electronic, standardize vendor process in all branches, minimize risk with vendor KPI’s, go green and more.

On average, 60% of total company cost is incurred through procurement of goods or services. Therefore, making your supplier management strategy work by equipping your team with appropriate tools to enable them to their job optimally will improve bottom line.