Why are supplier relationships important to procurement?

Most organisations focus on customer relationships, profitability and higher sales, forgetting about the importance of…...
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Most organisations focus on customer relationships, profitability and higher sales, forgetting about the importance of supplier relationships. If you work in procurement, you ignore supplier relationship at your peril. Here are some reasons why procurement cannot disregard supplier relationships.

Reduce spend

Procuring and sourcing are one of the highest spends that organisations have. Good supplier relationships can help organisations save money because happy, loyal suppliers and vendors will be more than willing to extend deals, discounts, and incentives.

Enhanced efficiency

In today’s competitive marketplace, it is essential to have an effective supplier relationship management in place. This way, you can get rid of manual administrative tasks to manage suppliers, boost communication, resolve issues quickly and minimise the chance of errors. Good supplier relationship and management boost organisational efficiency.

Supplier loyalty

Finding good and reliable suppliers is not easy. If you find the right suppliers for your organisation, strong relationships will ensure that you keep them long-term. Happy and satisfied suppliers will come to your rescue in emergencies and work to influence your organisation’s success.

Better value

Procurement works to secure the best value for money and, if you have exceptional supplier relationships, that is what you will get. You will be able to boost service levels, get goods and services on time, and forge a symbiotic relationship with your suppliers.

Get priority service

Good supplier relationship ensures that suppliers will always be ready to prioritise your needs. They will work hard to meet your quote, ensure goods and services reach you on time, and always offer you the best quality. Above all, they will support you when the need arises.

Taking these benefits into consideration, procurement should emphasise the maintenance of stellar supplier relationships.

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