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Vendor Relationship Management: 6 Tips for Success

Vendor Relationship Management: 6 Tips for Success

When it comes to your business success, sometimes you just need a little extra help in certain areas. That is where having an outside vendor who can add expertise and knowledge to your business can be extremely beneficial.

But a vendor relationship can sometimes be a little tricky. It is not the same as a customer relationship or even an employee. So it can be tough to understand how to handle a growing relationship in the right way, so that it positively affects your business.

1. Share Your Goals and Priorities

You know your business best, whereas your vendor may not completely understand your business goals, or where your company is coming from, right away. They may have boundless information and expertise in their industry, but getting that to translate into results for your business is a matter of communication and mutual understanding.

So instead of leaving your vendor guessing what your priorities are, make it clear from the beginning where your business is headed. This will allow them to see where they can contribute to help you get there.

2. Provide a Clear Way to Communicate

The best way to do this is designate a specific person to manage communications with a particular vendor. This not only provides in-house clarification on who is responsible, but also gives your vendor a point of contact for their needs. This will empower your vendors to be successful and to gain the clear insight they need to do their best work.

And if you do find your vendor being unresponsive to any communication attempts, take that as a warning sign that this relationship is not headed in the right direction.

3. Have Clear Cut Objectives

WIthout clear directions, you can’t expect anyone to make it to a destination in a timely or efficient manner. So provide directions in writing. This will ensure that everyone knows what they are responsible for and will give all parties involved something to refer to when a question arises.

This vendor contract should include information like:

  • What services are they providing?
  • What time frame can you expect?
  • What do your vendors need from you in order to complete the task?

All this information will make it clear from the beginning what expectations are, and how they can fulfill those expectations.

4. Request Progress Reports

This can be an email or a call daily, weekly, bi-weekly, or monthly depending on the scope of the service they are providing and how long you have worked with them. As a vendor gains your trust, you may start to see those progress reports lessen or change form, but in the beginning it is important to set expectations and receive all the information you need to ensure that your vendor is doing what is expected and is communicating with you any needs they might have. This will keep your vendor and yourself accountable and productive.

5. Allow Room to Grow

Vendors are going to mess up. It happens. People make mistakes.

Just like with any relationship, don’t expect someone to come in and read your mind immediately. The transition period can be very difficult at first as you both get to know each other, so keep in mind that mistakes and miscommunication will most likely happen. When something does happen, be clear in communicating what you expect in the future, and allow that vendor room to learn from the mistake and understand your business better.

6. Learn When Enough is Enough

So lets say you have been following all of the previous methods. You’ve been communicating your goals and expectations, you’ve received the progress reports, and you’ve given your vendor room to make a few mistakes.

But its just not working. For some reason this vendor is just not getting it. First, ask yourself a few simple questions before making any decisions:

  • Are you holding up your end of the bargain and providing them all the information they need?
  • Does your vendor clearly understand your business goals?
  • Do they truly understand what is expected from them and when it is expected from them?
  • Do they understand what mistakes they have made and how you’d like to see them corrected in the future?

If they answer is yes to all of the above, then it may be time to look elsewhere for that extra help.

Vendor relationships boil down to communication and expectations. Without these two components you will definitely see problems in your vendor relationship, just like you would in any relationship. Do your best to set your vendor up for success, and they will do their best to do the same for you.

About the Author - Jeff Reinstein is the Chief Executive Officer of Premier Business Centers. He earned his Bachelor of Science degree from California State University-Northridge in Business Administration, Finance, and Real Estate.

Posted: 4/10/2015 10:13:39 PM by | with 0 comments