“Networking is not collecting contacts!
Networking is about planting relations.”
(Michael Rajiv Shah)
Building strategic relations with suppliers
Nowadays, doing business is faster than ever and collecting information about suppliers, as well as maintaining good relationships with them plays the key role for success. Quality cooperation brings quality relationships and therefore better conditions for you – buyers. For this very reason, paying more attention to building good relationships with your suppliers became more important than ever.
But why is this important?
If your Procurement succeeds in establishing trustworthy relationships with suppliers, it will bring your business numerous benefits. Good relations with suppliers can significantly affect quality and costs of delivered goods and services, as well as improve their efficiency. Such a way of doing business opens up new negotiating opportunities. By sharing your vision and goals with your suppliers, they gain insight into what do you and your business find important. This way of doing business creates a stable environment, in which both parties have many benefits. Such a situation is thus favorable for both you and your suppliers.
How do I achieve this?
How to build good relationships with suppliers when you probably work with so many of them? The key to success lies in defining and systematizing most important suppliers and then focusing on building relationships. Jaggaer.com suggests to start with a basic criteria, organizing them into tiers (i.e. silver, gold and platinum), based on the number of transactions or the biggest spend with a group. Another factor to consider is which one of them brings significant value aside from price, for example, a group with a mission similar to yours such as sustainability, diversity, etc. However, it’s very important that you don’t ignore transparency. Despite the fact that you are supposed to pay more attention to some suppliers, it is of crucial importance to guarantee same cooperation conditions for every one of them.
After categorization itself, focus on building quality relationships:
Meet with suppliers face to face
In order to encourage better business cooperation, it is good to meet with your key vendors in person. In the world where we increasingly communicate through digital media, it’s never been clearer that no form of communication has such value as “face to face”. Personal communication – going to lunch, coffee or any other kind of meeting, creates the opportunity for personal interconnection and conversation about things that are not necessarily related to business itself, but are key to establishing good relationships and improving cooperation. By establishing personal contacts, we often hear useful information about different topics we would never discuss via e-mail or phone, as well as learn some new things. Man is a social being that can’t function without interaction with other people. Why do we avoid personal contact then?
Agree on both sides’ expectations for the relationship
All good relationships lay primarily on mutual trust and respect. However, establishing such a relationship is a lengthy process in which defining expectations on both sides is of great value. It is good to meet suppliers with your goals and mission, as well as to respect their attitudes and ways of thinking. In business negotiations, it is important to find common ground and to create compromises. This way, pleasure won’t be missed on either side.
Ask for supplier feedback
It is common practice for companies that hold up to their reputation to seek feedback through different surveys from their business associates (and therefore suppliers). By analyzing data collected, companies gain useful information on the quality of their collaborations, as well as knowledge about segments that need to be improved to make it even better. In order to better collect and analyze information about your suppliers, you can use your procurement software. In developing Ensolva, we have not neglected that part either. Ensolva provides you with complete insight into supplier information – contacts, documents, products and pre-achieved collaborations. It automatically updates and systematizes data in order to make it available for you at any time. Gathering and analyzing supplier data is a key predisposition for building a strong relationship. As well said by Women in Adria, not managing data has similar effect on our business as being blindfolded while driving: we do not know where we go nor when and whether we will even reach our destination.
And last but not least, on our journey to building good relationships, we suggest you to have a person that will nurture your business relations. It’s not necessary for that person to be a good negotiator, but it’s crucial for him/her to be capable of establishing good and quality communication with your business partners on long tracks. Start using these tips today – determine which your key partners are and build relationships that will bring immense and long-term benefits to your business!