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Building Deeper Supplier Relationships in 2021
If you ask any procurement leader they will tell you that fostering strong, lasting supplier relationships is important to the success of their department. Despite this near universal belief, many purchasers do not have a formal plan to enhance their relationships with high-performing suppliers, or a strategy to find the best suppliers in the market when searching for a new product or service. As we move into an evolving work environment that is more reliant on technology, building deep supplier relationships is only going to continue to become more important. Here's why:
Suppliers can be your biggest ally and safety net during uncertain times.
2020 showcased the importance of having deep, developed supplier relationships. Many governments, from states down to small local municipalities, were able to get the majority of their pandemic needs from existing suppliers, even if it was through unorthodox methods. With the switch to just-in-time delivery over the last decade, and a decreased reliance on warehousing, many procurement departments saw their inventory quickly run dry. But governments with strong suppliers relationships were able to make a few phone calls and lean on their suppliers with large warehouses and inventory management expertise. On top of all that, when the national supply chain began to fall apart and deliveries were taking weeks instead of hours or days, it was the suppliers that consider themselves strategic partners that came through and provided creative solutions.
2020 showcased the importance of having deep, developed supplier relationships. Many governments, from states down to small local municipalities, were able to get the majority of their pandemic needs from existing suppliers, even if it was through unorthodox methods. With the switch to just-in-time delivery over the last decade, and a decreased reliance on warehousing, many procurement departments saw their inventory quickly run dry. But governments with strong suppliers relationships were able to make a few phone calls and lean on their suppliers with large warehouses and inventory management expertise. On top of all that, when the national supply chain began to fall apart and deliveries were taking weeks instead of hours or days, it was the suppliers that consider themselves strategic partners that came through and provided creative solutions.
Suppliers want to partner for the long haul.
If you work in Procurement long enough you will inevitably come across a "bad" supplier. Maybe this supplier has poor customer service, lack of attention to detail, or an inability to finish a project on time. Or maybe they have a more serious issue like a history of financial fraud or ignoring safety codes on construction projects. Suppliers like these are part of the reason that Procurated exists — to flag them using peer reviews and make sure other purchasers avoid working with these suppliers — but they are generally in the minority. The best suppliers want to foster a lasting partnership, a deep relationship built on trust and communication, that will last well beyond 2021.
Suppliers can deliver on more than price.
The best supplier relationships are not built on price, but rather on a common understanding of the exact needs of purchasers. And the most successful projects occur when suppliers are looped into the process during the strategic decision making and planning phase. This creates a deeper understanding of the project as a whole, and allows the supplier to pivot if necessary to deliver on what is ultimately required under a contract. This process requires a tremendous amount of trust, and does become easier over time with suppliers that have a proven track record of success over years.
If you work in Procurement long enough you will inevitably come across a "bad" supplier. Maybe this supplier has poor customer service, lack of attention to detail, or an inability to finish a project on time. Or maybe they have a more serious issue like a history of financial fraud or ignoring safety codes on construction projects. Suppliers like these are part of the reason that Procurated exists — to flag them using peer reviews and make sure other purchasers avoid working with these suppliers — but they are generally in the minority. The best suppliers want to foster a lasting partnership, a deep relationship built on trust and communication, that will last well beyond 2021.
Suppliers can deliver on more than price.
The best supplier relationships are not built on price, but rather on a common understanding of the exact needs of purchasers. And the most successful projects occur when suppliers are looped into the process during the strategic decision making and planning phase. This creates a deeper understanding of the project as a whole, and allows the supplier to pivot if necessary to deliver on what is ultimately required under a contract. This process requires a tremendous amount of trust, and does become easier over time with suppliers that have a proven track record of success over years.
Suppliers will speed up the transition to a new data-centric, digital-first environment.
The age of going to the file cabinet to find the document you need was almost over already. But, the 2020 pandemic was the final blow. It became increasingly clear in March and April of 2020 how important it is to have instant access to digital versions of important documents, electronic purchasing capabilities through digital eProcurement systems, and high quality video and audio technology that allows us all to communicate with each other as efficiently as before. The suppliers that are helping governments keep pace and adapt to this new world are the ones that will win. They are helping governments build out comprehensive digital strategies, and only continue to improve as their databases get more robust and data teams develop a better understanding of the information at their fingertips. The governments that take this data-centric approach and adapt to this digital-first environment will inevitably make the best decisions.
It is worth investing time, energy, and money into the suppliers that want to build strategic partnerships that grow and evolve over time. Those suppliers are the ones that will be there to help solve strategic problems in the times of greatest need. They will think outside the box and step out of their comfort zone to help create a solution for you and your government. To learn more about suppliers that are already doing great work, search Procurated.com for the goods or services you need most.
The age of going to the file cabinet to find the document you need was almost over already. But, the 2020 pandemic was the final blow. It became increasingly clear in March and April of 2020 how important it is to have instant access to digital versions of important documents, electronic purchasing capabilities through digital eProcurement systems, and high quality video and audio technology that allows us all to communicate with each other as efficiently as before. The suppliers that are helping governments keep pace and adapt to this new world are the ones that will win. They are helping governments build out comprehensive digital strategies, and only continue to improve as their databases get more robust and data teams develop a better understanding of the information at their fingertips. The governments that take this data-centric approach and adapt to this digital-first environment will inevitably make the best decisions.
It is worth investing time, energy, and money into the suppliers that want to build strategic partnerships that grow and evolve over time. Those suppliers are the ones that will be there to help solve strategic problems in the times of greatest need. They will think outside the box and step out of their comfort zone to help create a solution for you and your government. To learn more about suppliers that are already doing great work, search Procurated.com for the goods or services you need most.
Published on Jan 21, 2021
