Managing your supplier list is important component of effective cost saving procurement strategy. Suppliers refer to wholesalers, distributors, manufacturers and vendors as well as importers, etc. In managing supplier relationship, it is important to treat suppliers not just outsider vendors of your company but as partners, with whom you share similar objectives. A company may invest on technology by buying supplier management software for creating, processing and tracking purchase. As partners, you should make sure that you are able to pay your partners in time to build a great relationship with them. You can strengthen and deepen relationship by holding collaborative projects that can further decrease cost. And within this collaboration, entails deeper, clearer and organic communications. Maintaining good relationships with suppliers is needed in order for a company to the best deals in negotiating with them. Although relationships are important, you should forge relationships with suppliers based on their competency and efficiency as well and not just because you like them. Focus on your suppliers that deliver.
While you may have established trust with your supplier, managing relationship should nevertheless be continuously formalized. Supplier Relationship Agreements should continuously be prepared that details service description, price and terms and conditions, among others. Risk should consistently be evaluated because of changes in circumstances. And most importantly, get everyone involved to attain better spend management visibility.