Supplier Management

Managing Your Supplier Choices ...

Your choice of supplier can be very small or very large, depending on the type of product or service your business requires.

If, for example, you require printing paper there are hundreds of manufacturers and potentially thousands of suppliers in most countries, so your choice is virtually limitless.

If however, you require a special bespoke electronic switch for a product you manufacture, there may be only two producers of those switches in the whole world. Your supplier choice is therefore, very limited.

So, good supplier management means weighing both these factors before making a decision on your choice of supplier ...

• Compile a list of all those suppliers that can be expected to meet your requirements.
• Explain to them your specific requirements and ask them to provide you with their terms and conditions of service, price lists, delivery costs and anything else that you consider relevant to your business requirements. Make sure all this is in writing.
• Once you have the information, check the company's financial position. Make sure the business is solvent and there is no potential to be let down later.
• If everything looks okay, ask the supplier to provide you with the names of some of their existing customers, and check with those customers regarding the potential suppliers reliability and customer service.

Finally, when you have compiled a short list of potential suppliers, arrange to visit them and meet with their principles. Consider how well they operate their business; does it instill confidence, does it make you feel happy to be doing business there?

It may not always be possible but try to spread any risk to your business by having, and building a relationship with more than one supplier that can meet your business requirements.

The unexpected does happen, employees leave, machinery breaks down, business owners lose interest, they retire and sometimes die.

By following sound supplier management principles and doubling up on your supply chain relationships, you ensure your business is covered against any unforeseen events.

Managing your Suppliers and Building Your Supply Chain Relationship ...

Once you have decided who the suppliers of your goods and services will be, it's time to build a supply chain relationship with them.

A relationship that will be mutually beneficial.

You need a reliable service, they need a happy customer, so it is worth making sure that you get the great service you require and depend on, by spending a little time and effort in building a good relationship with your supplier.

• COMMUNICATE ... Communication is the key to getting good service. Speak to your suppliers regularly, engage with them and show an interest in how their business is being helped by your business, as well as how their business is helping your business.
• CLARITY ... Always be clear in what your business needs and when you need it. When placing an order always know or agree the cost in advance and ensure it appears on the official order. Disagreement over cost has destroyed some perfect supplier/customer relationships
• COURTESY ... Being courteous to your suppliers pays dividends and costs nothing. Be firm, open and fair but be courteous. Place your orders as far in advance as possible and if it is a rush order say so. Courtesy will always receive a response in kind.
• PAYMENT ... Pay your bills on time. If you value your suppliers reliability and good service, show it by paying them on time. If you can't pay, say so up front and if your supplier management skills are good, you will be able to come to some amicable arrangement.
• APPRECIATE ... Show your appreciation of your good suppliers by inviting them to your company functions. This form of socialising can pay very good dividends. It lets your suppliers know you value their contribution to your business.

Finally remember that busines is never a one-way street. You are your suppliers customer, and as a good customer you should expect your supplier to provide you with excellent customer service in the same way you provide it to your own customers.

Keep your supplier management and supply chain relationships strong and you will find that great customer service is what you get.