A significant percentage of businesses consider supplier onboarding of critical importance in their operations. Some of the benefits that these businesses have been enjoying from supplier onboarding include enabling the companies to keep track of their suppliers by having their information in the various systems they use at the workplace, better vendor relationships, eliminating vendor risk, and avoiding duplicate information.
To enjoy the mentioned benefits, you must have a robust vendor onboarding process. Here are supplier onboarding best practices.
1. Understand the onboarding parameters
Knowing the supplier compliance policies that are relevant to your business and niche will be the first step to effective supplier onboarding. Be it global, local, or internal compliance issues, familiarize yourself with them and factor them in your evaluation process.
This will help you conduct comprehensive due diligence that will help you select who you can work with and take them through the approval process.
2. Assign a team for onboarding
Truth be told, the initial onboarding process for suppliers is not the easiest job to do. If you are not careful, you might get caught up in the confusion that will beat the entire process’s purpose. It is therefore essential to assign a person, if not a team, for vetting the suppliers.
To avoid errors in the process, allow only a designated team to work on this. It will ensure uniformity in the process and also eliminate mistakes.
3. Automate the vendor onboarding process
Automation will make the process more streamlined. Automating will make the process faster and again come with the benefits of self-serve. These include accurate data entry, reduction of redundancies, real-time collection of data, and enhanced productivity.
Automation of supplier onboarding also involves integration with ERP and other systems in the organization.
Any opportunity to automate should be welcome as it will boost efficiency.
4. Have a plan for each vendor relationship
The vendors are different, and this will call for different engagement with each one of them. A partnership plan for every vendor should be set, and a follow-up strategy also created to inform your relationship growth strategy.
This will go a long way in ensuring that both you and the supplier get value from the relationship.
5. Set expectations and share them with the vendors
This will guide your relationship with the vendors moving forward. The expectations should cover the quality of their products, lead times, pricing, and much more. Just like having a plan, setting expectations will inform and guide your relationship with the vendors.
The success of any business heavily relies on the quality of the relationships it has. Be it with shareholders, competitors, customers, and even suppliers. Supplier relationship management, therefore, is critical to businesses. Supplier onboarding is usually the first step businesses take towards a sustainable relationship with their vendors.
A robust vendor onboarding process will go a long way in helping your business mitigate risks, automate tasks, and track data. The above vendor onboarding best practices will help you streamline not only your procurement but overall business operations.