Finding the right supplier for your business isn’t just about managing your spend and finding the best deal. With increasingly complicated supply chains and a wide variety of suppliers, B2B companies need to take a controlled, systematic approach to souring if they want to be successful.
That’s where SRM (Supplier Relationship Management) comes in. SRM is an essential tool for unlocking value that goes beyond simple savings. It involves planning for, overseeing and keeping track of all interactions your business has with third party organizations. Here are 6 benefits of proper Supplier Relationship Management.
With quantitative and qualitative supplier data, procurement can quickly identify risks, vulnerabilities and opportunities in the supply chain. This knowledge can help them improve their strategies and methods for managing their suppliers.
Setting up deals with new suppliers usually comes with some serious costs. However, by fostering a mutually beneficial relationship, businesses can avoid unnecessary costs that may come from renegotiating or ending contracts early.
According to the IBM IBV Chief Procurement Officer Study, top-performing procurement organizations cited bringing in innovation into the enterprise as a top priority, second only to reducing costs and increasing profitability for the business. By building a collaborative relationship with SRM, businesses can look to suppliers for innovation. With open communication, suppliers can share ideas for product improvement, supply chain process innovation and service innovation.
When the company and supplier understand each other’s business, they’ll be more equipped to help each other. Although both parties may have to do some adapting, it can ultimately increase operational value. Also, if an organization can reduce the amount of suppliers they have, they can drastically reduce their costs.
By sharing feedback and ideas with each other, businesses and suppliers can improve operations, streamlining the supply chain, improving go-to-market time and customer service and lowering overall costs.
By building trust with certain suppliers, organizations can outsource non critical tasks to third parties. Not only can this lighten the internal workload, but it also allows buyers to get service or industry expertise.
Researching and keeping track of what’s going on with your suppliers is essential for mitigating risk and open communication and strong collaboration are helpful for improving processes and products.
To manage all your suppliers in one place, join and connect with them on the Koble platform. After inviting your vendors to the Koble network, you can easily communicate with them via individual chat or group chat. With realtime updates on your feed and access to advanced financial and sentiment data on suppliers’ profiles, you’ll be the first to know if anything’s happening with your partners.