How to improve Supplier Relationship & Performance

How to Improve Supplier Relationship & Performance

Procurement companies and professionals alike are always hunting for techniques to review, concretize & improve upon relations with their suppliers.  The flipping of a calendar year provides a good opportunity to evaluate supplier performance in order to have seamless coordination whole year long.

Nowadays, there are a number of ways to collect feedback. However, the key is making sure you use the method that provides the actionable insights on the specific supplier. Here are a few ways you can collect feedback.

Supplier meetings and Focus interviews.
This is very important as one-to-one interaction with your suppliers may shed light on bottlenecks, which have been decreasing process efficiencies while focus interviews would help you collect qualitative data and better the needs and concerns of your suppliers.

Internal stakeholder surveys.
Suppliers have a widespread network and supply goods to many businesses. So surveying business partners would prove to be beneficial to check supplier performance.

Hiring third-party consultants.
It’s always a good practice to hire third-party consultants to review your suppliers as it removes any chance of a bias meanwhile you can concentrate on your business operations.


Develop a Supplier Scorecard
Supplier scorecards provide insightful metrics to measure the performance of your suppliers. However, your scorecard would be relative to the key performance indicators (KPIs) you include as a measure of performance. Additionally, KPIs should be updated regularly to ensure you’re tracking the supplier’s current work.

Few performance indicators may be-

Inventory management– A supplier with instant availability of products is generally more useful to businesses than a supplier who prolongs lead time to source and deliver.

Quality– The quality of the product being delivered by the supplier is a primary concern for any business partner.

Competitive pricing– Supplier should provide best prices for products, which are at par with current industry rates.

Fulfillment rate– the order volumes the supplier fulfills over a period of time should also be tracked.

Responsiveness-Supplier response to requests for quotes, special requests, etc.

Financial metrics– A supplier’s financial stability and ability to meet the terms they agreed to should be tracked over time.

Sourcing capabilities– instances may occur when your supplier may not have the desired product in his inventory, can he source it from within his network of contacts?


With all of these techniques, you should be ready to improve supplier relationships and performance.

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