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How to Build Strong Vendor Relationships

Posted by IBS Marketing on Dec 8, 2021 10:56:43 AM

Developing strong vendor relationships is crucial to the health of your business and can have a big impact on its success. Vendors benefit businesses in many ways by providing knowledge and expertise, and by supplementing your business offerings. Partnering with vendors to fill in the gaps in the supply chain keeps costs down and business processes running more efficiently. This can be invaluable in the face of disruptions. Vendors also help companies remain on the cutting edge and improve overall quality. As such, it’s important to build and maintain strong vendor relationships.

Here are some points to keep in mind when working with vendors to ensure a trusting, beneficial relationship — for everyone involved. 

Communicate Clearly, Well, and Often

It’s important to always provide vendors with clear explanations of your business objectives and expectations. This helps them see how their objectives should align with, and support, your vision. Sometimes this may involve sharing sensitive data. Sharing information also gives vendors important insights into your business, so they can assess if their services are a good fit, and rise to the task. Keeping lines of communication open helps vendors feel empowered to ask questions as needed, which can help avoid potential mistakes down the road.

It’s a best practice to designate a clear point of contact for vendors. It can get confusing to receive different communications from different people via different channels. Having one person who acts as a liaison establishes familiarity and consistency as well as allows the time to develop a more meaningful partnership with your vendors.

When communicating with vendors, don’t solely rely on email. While email can be the primary method of contact, a phone call, or even a video chat is much more personal. In-person meetings take it a step further. Taking the time to get in some face time, even if virtually, can help strengthen an otherwise distant relationship.

Define Expectations (and Train Vendors to Follow Them)

Beyond the day-to-day communication, be sure to put in writing the key goals and objectives that are expected from the vendor. Having concrete reference points will help your vendors know their goals and your expectations. It can also keep everyone organized and on the same timeline, which is key when you manage more than one vendor. Deliverables like contracts, changes to scope of work, invoices, and payment receipts should always be in writing for later reference.

Follow up regularly on expectations with intermittent progress reports. Frequent check-ins will ensure nothing falls through the cracks, as well as provide a clear picture into what is happening on the vendor’s end. The unexpected can often pop up, and you don’t want to be caught surprised. Regular check-ins also ensure mistakes are handled before they turn into all-out fires.

Practice Good Business Sense

We all know what types of people we like working with. If you’re communicating clearly, and setting well-defined expectations, you have already won half the battle. But “soft skills” like friendliness, owning up to your mistakes, honesty, and a sense of humor can go a long way toward strengthening vendor relationships, too.

Prompt payments are also key! Vendors shouldn’t have to spend time chasing down your payment, and slow payments can put a strain on the relationship. Be known as the business who is easy to work with and pays on time. On the subject of time, always provide enough notice or lead time for requests, especially if they are outside the usual scope of work. Just as you may deal with several different vendors, vendors also work for many companies. Valuing their time is not just common courtesy, it can set you apart from their other obligations. (Not to mention, work in your favor by getting you better service!)

Finally, if you are happy with a vendor’s work, pay it forward (after renewing your own contract, of course). Vendors rely on repeat customers and word-of-mouth to stay in business. A trusted reference to a colleague speaks volumes more than an emailed compliment. If you’re truly happy with the work prove it by giving the vendor more business. In turn, they may return the favor.

How do you build and maintain strong relationships with your vendors? If you are or have been a vendor, what were your expectations of the companies you partnered with?


Topics: Business Management

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