The way an e-commerce business chooses and handles its vendors determines their overall success. In this blog, we are going to take a deeper look into how vendor management can make or break your e-commerce business.
What is Supplier Management?
Supplier management is the process of maintaining relationships with your vendors. It includes managing contract negotiations, having meetings about quarterly reports, and sharing regular sales data analytics. In simple words, it is the management of the people who supply all the products that you choose to sell to your customers.
Additionally, vendor management is exchanging the information that you need in order to mutually benefit and grow each other’s businesses. Let’s have an in-depth look at why vendor management is necessary to build a successful business.
Why do we Need Supplier Management?
To Create Better Relationships
The vendors and your relationship with them define the quality and availability of the products. Which directly affects your relationship with your customers. At the end of the day, sales and customer satisfaction decide the fate of your business. If you build a mutually satisfying, and a growth-oriented relationship, it will pay off in the long term. Hence, with proper vendor management, you are directly working on the quality of your relationship with your customers.
Pro Tip: The best way to manage a healthy and functional relationship with vendors is to regularly send them quality analytics of the customer behavior patterns. This will simplify your communication with them.
Efficient Process
Keeping in constant touch with your vendors is vendor management in simple terms. This practice makes it easy to negotiate products prices. Sending emails back and forth can do the trick, sure, but when you have to do it every few days, then it can be a bit cumbersome. So, you have to set a flow to check in with all your vendors at least once a month as a part of vendor management and make sure that everyone gets their word in, in terms of pricing, quality, and delivery.
Protects Brand’s Goodwill
Supplier management influences your brand name. When done well, your vendors will be more than happy to work with you, and this will also attract more vendors or vendors may turn to exclusive partners. When your vendors trust you, it gives way to a mutually beneficial relationship and they become your brand promoters.
Minimizes Risk
The biggest risk of downfall that your e-commerce business can face is the unavailability of high in-demand goods which is directly dependent on the vendors. If you manage your vendors as well as you generally aim to manage your customers, then you build a relationship with them. In the grueling world of business, good business relationships built on acknowledging each other’s shortcomings and strengths go a long way in the success of your business.
Your success is dependent on the efficiency of your communication with vendors and suppliers. Emails don’t have to be the only solution. The most effective way to manage your vendors is to have a proper vendor management portal. A portal bridges the communication gap and makes everything accessible easily for both the parties.
Apart from that, let’s see what are the best practices for Supplier Management.
Best Practices for Supplier Management:
Proper Supplier Selection
This point goes without saying. It is extremely important to choose the right vendors, as it is to choose the right partner. It determines quality control, financial flexibility, and long-term loyalty.
Be in Touch Constantly
You have to be in constant touch with your vendors. An exchange of ideas is important to grow a business. You can get a clearer idea of the quality that they maintain and they can get a clear idea of your sales practices, so they know they are getting fair treatment.
Supplier Management Portal
Communication via emails and meetings can be time-consuming, and often confusing. This is where a Vendor Management Portal comes in. This is a tool that makes managing simple for you. Once a vendor data is in, it connects to every aspect of the communication with them. It has a module for connecting specific products to specific vendors, for getting quotes, negotiating pricing, and whatnot.
A supplier management portal is more than just a database of all the vendors that you work with. It also connects to your Customer Relationship management portal in case you need to give your vendors access to a specific module. Your vendors will be able to generate invoices right from the portal itself without having to go through any hassle of dealing with it on another platform.
Vendors from all over the world can simply register with your portal. No need for them to be in the same place as you geographically.
The Vendor Management Portal also has a procurement module that allows your procurement manager to easily compare quotes from various vendors regarding all the products. The manager can compare based on both price and quality of said products, as well as other metrics that you want to set. This way, your procurement manager can always make well-informed decisions about choosing the right vendor.
Conclusion:
With a huge business comes a lot of small responsibilities. And a whole lot of them are managerial, which you can easily manage with the help of a portal. If you want to explore options for supplier portal solutions then CRMJetty has an excellent supplier management portal that you can check out here.
And if you want any additional information on vendor management portal, then feel free to contact us here.
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