How To Develop Good Business To Vendor Relationships

Building good vendor relationships is centered around trust, smart decision making and consistency. The first phase of long-lasting vendor relationships starts with clearly communicating business goals, expectations and business vision. The second phase is productivity. The third phase is consistency.


After a business-vendor relationship is established, it is critical to have a business manager, or account representative that is competent and skilled at maintaining business relationships. The liaison should consistently make phone calls and conduct site visits to ensure expectations are being met. The liaison is on the front-line, and they are responsible for ensuring vendors are happy. They are an extension of an organizations quality of service.

Putting everything in writing may seem tedious, but it gains the respect of your vendor, and protects all parties involved. Documenting all relevant components of the relationship, puts everything on the table, and covers many areas which include; responsibilities, anticipated sales volume, best practices, payment receipts and more.

Producing periodic reports is an essential factor that demonstrates a companies commitment to accountability. Reports are an effective way of showing progress, and highlighting areas of improvement. Reports create a virtual map of how processes and protocols are unfolding.

Planning is an essential component of healthy business-vendor relationships. It may seem like a subjective process, but it can ensure deadlines are met. Planning ahead can allow both parties to make necessary adjustments if necessary. Delays and last minute changes can be detrimental to business relationships, and can negatively affect profit margins.

Depending on the type of industry, training may be necessary. It is not safe to assume that vendors know what to expect. Training may require an additional expense, but it may be worth it in the long run.

Create an environment that encourages vendors to commit to results, rather than sales. Remember, their success is linked to an organizations success. This approach goes a long way toward improving chemistry between both parties.

If an agreement between a vendor and an organization cannot maintain value from the initial investment, then long term relationships are doomed. Always remember that fairness and honesty is the cornerstone to productivity. If all parties stick to their commitment, then success is almost certain.

Business relationships are vulnerable to the same pit-falls of all relationships. Therefore, it is necessary to have effective modes of conflict resolution. Vigorous relationships are able to withstand adverse situations – which are bound to occur at some point in time. Usually, when business relationships fall apart, it is because trust was violated. If lines of communication are always open, and protocols are in place to foster productivity, then conflicts can usually be resolved when anomalies occur.

If companies have smart systems in place, diligently create frequent reports, plan ahead, and maintain constant communication with vendors. Then the chances of long-term, and productive business relationships are almost certain.

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