Adding Value Is Important Than Saving Cost!

Authored by Azra Sultan

Nowadays it is very critical for organizations to control their expenditure and identify new sources of supply to achieve cost savings. At the same time, it is imperative for product or service provider to demonstrate value for money for its customers where they cannot compromise on the quality of their offered products and services. Vendor relationship is one of the key factors for adding value to organizations purchasing process and for a successful vendor relationship, it is crucial to communicate your organizational goals, business vision, and your expectations to vendors. This will surely encourage them to work harder to improve the quality of supplied products or services as knowledge about customers goals can always help vendors to make the best decision in customers favor.

The most important factor to keep vendors’ interest intact in your business is to answer the vendors’ queries as promptly as possible. This will surely give them a sense of confidence and trust you have developed by making them a strategic partner in your organization’s success. Also avoid delays in payments, unless unavoidable, as it strains relationship, however an amicable solution for an appropriate payback period can be discussed with the vendor to minimize an adverse effect of squeezed fund position on all stakeholders. The Supply Chain Teams should also show loyalty to vendor by frequently giving them business resulting into enhance motivational level, vendor may return the favor by offering discounts and incentives. This is how you add value to your purchasing process by ensuring timely and effective service by the vendor which is more crucial than cost savings most of the times.

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