Many businesses focus on growing the relationship between themselves and their customers above all else. After all, without the customers, there is no business, right? But there is another very crucial relationship that affects your bottom line as well – your relationship with your supplier. Supplier management isn’t just about making sure your days don’t involve a lot of headaches! Maintaining a positive supplier relationship can save you money, help you serve your customers better, and can offer significant long-term benefits.
Why are supplier relationships important?
So, despite the fact that suppliers represent an important relationship for any business, why is it that so many companies ignore supplier management entirely? If you have never considered if you and your suppliers are on good terms, ask yourself about the performance of the following areas:
Are your materials or products always on time? Are you receiving high-quality materials or goods? In other words, does it appear that the supplier values your business and pays attention to the details?
This is important for so many reasons. It helps prevent returns and production halts. It makes production or stocking a smoother process, and it ensures that your customers are more satisfied with the items they purchase. And, as we all know, customer satisfaction goes a very long way to earning you even more business.
Does the company offer you support when things go wrong? Do they offer help when a shipment is damaged, or have they worked with you during a relocation or system change? In other words, does your supplier care whether or not you get your products or materials?
The biggest benefit of this is that you will save money. A supplier that does nothing to fix a damaged, lost, or slow shipment will just lead to you ordering more goods.
Does the company offer any special promotions or discounts for certain behavior on your part? For example, do they offer a discount for cash payment up front, or a bulk deal if you schedule all your orders for a calendar year?
These things can definitely add up when it comes to your supply costs. Often times a supplier will offer some sort of discount or special pricing if you maintain a strong relationship with them.
4 Things You Can Do to Foster a Great Supplier Relationship
If you have a great supplier, it’s in your best interest to hang on to them. If you don’t have a close relationship with your suppliers, now is a great time to foster one. Putting attention into this relationship will save money spent and help you get more bang for your buck – that’s great news for your bottom line. Here are four things that you can do on your end to built or improve a supplier relationship:
Set a schedule
Be sure to schedule time for your team to place orders well before you need the inventory. Shipping is not always under the control of the supplier. Don’t plan poorly with inventory and expect to receive your inventory very next day.
Make timely payments
Pay the bills on time. This is the best way to get those potential money-saving discounts. One of the quickest ways to strain a supplier relationship is by making late payments. If a supplier feels they can’t trust you to pay for their goods, why would they offer you helpful perks?
Keep an open line of communication
Communicate transparently. If you have any issues with a shipment, contact the company right away to get it resolved. Keeping communication open will help your supplier remember your business and makes future interactions easier.
You may have a dedicated account manager for each supplier, but they’re not the only important contact. The sales representatives, for example, know how to navigate the supplier’s company structure to get you the help you need.
How Does Your POS Help Boost Supplier Relationships?
Retailers want to be more than just a number to suppliers — a collaborative partnership is an ideal situation that can benefit both parties. So, with that in mind, how can a POS reduce strain on the supplier/retail relationship?
Erply allows you to create and maintain a list of all suppliers and edit that information as needed to streamline business-to-supplier communication. If you receive a new point of contact or need to change the shipping address for a specific supplier’s items, you can make these changes in Erply’s back office. Using Erply to move things along in the supply chain also eliminates the need for unnecessary communication regarding delivery specs or changes in contact info.
One of the biggest things that can cause stress between a retailer and a supplier is balancing the ordering process. You don’t want to take up warehouse space with slow-moving inventory, but you also don’t want to keep customers waiting on inventory shipments. Careful inventory management on the retailer’s end is key to keeping this relationship smooth, and a POS can help maintain healthy supplier relationships.
Erply can be used to generate detailed inventory and purchase reports by store, supplier, and inventory. Regularly generating these reports will give you a better idea on how much stock to purchase and when to purchase it, making it less likely that you’ll need to contact a supplier for an order change. Erply can be used to automatically order new inventory when levels get low, preventing an accidental duplicate inventory order. The less often you need to have your supplier correct an ordering mistake, the more positive your relationship will be.
Putting it All Together
There are several key takeaways here that all business owners or managers should consider.
Your supplier relationship is every bit as important as your customer relationship. It can save you money, play a part in earning money, and help you build your reputation. Inventory management can be key to building a great relationship with a supplier. Using very structured inventory processes with a robust POS like Erply can help you manage your supplier relationship and see a more profitable bottom line.
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