Three ways to ensure suppliers 'have your back'

Robert Pease is Commercial Director at The FacultyCivil unrest has increased in a fifth of countries over the past quarter, according to the Maplecroft Civil Unrest Index. This is something procurement and supply chain professionals need to take heed of – unrest overseas, where suppliers are often based, can have a huge impact on you.

Earlier this year factories in Vietnam were stalled due to anti-Chinese protests, then there was Thailand’s anti-government coup which saw the country’s commercial centre come to a halt. Images of mounting unrest in Hong Kong as a result of pro-democracy demonstrations have filled our television screens. If this situation continues to escalate, there’s no doubt this will start to affect Hong Kong suppliers and even their supply chains.

In these situations, where supplier capability is limited, it’s understandable they’re going to prioritise key customers. As a buyer, how can you ensure you are top of the list?

It all boils down to cultivating strong supplier relationships, so here are three tips to help you move up the VIP list:

Building trust

It sounds simple but trust is often forgotten when establishing supplier relationships. It starts with communication – share your objectives with your suppliers, where your business is at and update them on how you’re tracking. Open your doors to them so they feel like an extension of your team.

Make it worthwhile

Find out how you can transform your relationship from transactional to mutually beneficial. What do your suppliers want beyond their pay cheque? What are their challenges? It could be as simple as paying your bills on time. A trend we’re seeing is suppliers and buyers working together to innovate on new products or services. For suppliers, these innovations could help build capabilities, broaden their customer base and create new market opportunities. As a buyer you’re able to outsource research and development to a company that already understands your brand. If the trust is there and suppliers enjoy working with you or even have skin in your business, they will be more likely to prioritise you in a crisis.

Train your team

At the core of supplier relationship management is your people. Your team (or it might be you!) need to be skilled in the art of managing supplier relationships. It’s not just about technical skills like contracting or the day-to-day operations, the best procurers are able to negotiate post contract value and demonstrate influencing and leadership skills. It’s important that your A-team is on the case as your supplier relationships can be one of your most valuable assets.

Remember, if you have a strong relationship with your supplier, they’re more likely to have your back in a crisis.

☛ Robert Pease is commercial director at The Faculty




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