Customer and Supplier Relationship Management

If you do create long-term relationships with your supplier, you could receive numerous rewards for your efforts – e.g. cutting costs in business, increased communication and efficiency. To have stability in your business, supplier relations are important to develop. You depend on your supplier to deliver the source material to create your product. Without them, you might struggle to offer your customers a final product, so keeping on good terms won’t do you any harm. But, you need to find balance and ensure that all of the power doesn’t belong to your supplier. For example, if you rely upon one supplier for a key section of your product, what would you do if they go bankrupt? Do you have a plan B? Like the old saying goes, don’t put all of your eggs into one basket. For guidance on handling these relationships, get in touch with the York, North Yorkshire and East Riding Growth Hub. We’re here to listen to your problems and point you in the right direction for any available funding support.

Supply chain development

A supply chain is the system that you use to get your product to end consumers. There will always be a need in business to improve speed and efficiency without sacrificing reasonable costs and quality. This is why supply chain development and keeping up-to-date with the latest trends is so important. Your supply chain will  need changing if you’re growing into a new market. For example, your supply chain isn’t simply about the people that provide materials to create your products, it’s also how the product will be delivered to the customers. If you want to grow into an overseas market, you’ll need to consider transportation of your goods and who’s going to sell it.

If you’re growing your business into a new market, you’ll need to identify what kind of supplier will be best to get your products to new customers. You won’t necessarily be able to rely on current suppliers. The 4 main ways to sell your product or service overseas includes: selling through agents and distributors, selling direct, licensing or franchising or setting up an overseas operations. If you use a distributor, you’ll need to include this in your supply chain.

Alternatively, if you’re looking at business growth through a new product, you might want to focus on improving flexibility to produce the goods. For your new product, you may need a supplier for one of the materials which you can’t manufacture yourself. A large trade show or exhibition can be useful to explore who’s producing the materials that you need. Even if you don’t commit to anyone at the exhibition, it could be a valuable chance for networking and promoting what you do. You never know, whilst you’re there, you might have the chance to make a few of your own sales. The UK Trader website also has a large directory of UK wholesalers. To improve flexibility, try to find a few suppliers that provide the materials. You shouldn’t juggle between all of these suppliers, have one main supplier, but it’s useful to know what your backup options are. If you’re aware of who else can supply your goods, you’ll be under less pressure if your current supplier went bankrupt.

Keep up-to-date with your supply chain through technology. For example, with transportation, you have GPS to help you keep track of trucks and see where your products are. Order tracking is also useful to provide information to customers. They’re going to be a lot happier with your services if you can give them confident updates. With growing competition, retention strategies for customers are important. Anything that makes your customer happier is likely to improve loyalty. This technology will be especially useful if you’re interested in growing into an overseas market, as it’ll help you keep better track of the different stages of transportation. For help with exporting, the Growth Hub can put you in touch with the Department of International Trade who also offers exporting specific grants.

Development is necessary to most parts of your business, if you want to see an improvement in performance – your supply chain is no different. So, if you’re based in York, North Yorkshire or East Riding and want advice on how to adapt your supply chain, give the Growth Hub a call. We’ll be able to introduce you to any possible funding support providers. For example, the Manufacturing Growth Programme provides a 35% grant to cover the costs of consultants who could support you with your supply chain development.

Supplier Relations

Supplier relationship management (SRM) is the process of interacting with suppliers and establishing what you want from them and defining what their expectations are of you. Relationships are vital in business, especially with your suppliers if you want to ensure that you’re on the same wavelength and objectives are aligned. You don’t want to commit to a deal then find halfway down the line that you don’t like the supplier (maybe they aren’t very reliable) that you signed up with.

To improve relationships, communication is key (which is discussed in the next section). You want to create transparency early on. Be clear and decisive about what it is that you want from your supplier. If they can’t support your goals then you know right from the start that they aren’t the best match for you, and you’ll able to find a supplier that can follow through with your expectations.

When developing relations with your supplier, you should think in terms of collaboration. It’s easy to get caught up in just what your priorities are. Your supplier is likely in the same boat as you and interested in making money, which brings you a problem. You want them to reduce the costs, but you need to learn when to pick your battles. Don’t let them take advantage, but, be aware, if you’re pernickety about every little cost then your relationship will soon sour.

Once you’ve got the right supplier on board, you can be demanding, but don’t push your luck. You don’t want to lose out on a good supplier, because they can impact a lot of your business:

Be fair with your supplier and you should be able to develop a trusting, loyal partnership. If you need help with how to handle this, give the Growth Hub a call. We’ll do the research and find out if there’s any funding support available. For support, a consultant may be useful and the Manufacturing Growth Programme can provide a 35% grant to cover the cost of hiring the expert.

Communication of strategy to suppliers

Having an effective supply chain will depend on how you communicate your strategy to suppliers. You need to be clear about what it is you want to achieve, so that your suppliers can act accordingly. If you’ve been misleading with what you say, you can’t put the blame on your suppliers. You should have regular meetings with your suppliers, as often effective communication relies on meeting up face-to-face. You don’t need to worry about bad connection which can occur when you’re on the phone or mishearing information.

But don’t forget to put what you discuss down in writing. This way, if something does go wrong, you can refer back to a document and help to clear up any confusion. Or, if your supplier is uncertain about something, they can refer back to the document. This will save you time, as they won’t have to constantly call you with follow up questions and money, as things shouldn’t be sent at the wrong time or to the wrong place, for example.

You need to have regular conversations with your suppliers. You should update them on what your expectations are and ensure you’re on the same page throughout your contract. A disruption from your supplier could lead to a delay in the manufacturing process and put a halt to sales. By building a strong relationship with your supplier and having open discussions, they’re more likely to warn you if they encounter a problem. Then you’ll be able to better prepare a resilience plan.

However, sometimes emergencies can’t be avoided, for example your supplier has no control over a natural disaster that has prevented them from delivering goods. You should agree early on how you will respond if something threatens the supply chain.

If you’re uncertain about how to communicate your strategy to suppliers then give us a call at the Growth Hub. Once we know your problem, we’ll do the hard research and find you the relevant support, so you can put your time to better use. For example, you might not be aware that there is funding in the York, North Yorkshire and East Riding area for staff training. With Skills Support for the Workforce, you could send your employees on people management training, so that they are able to better handle the interactions with your suppliers.

Account Management

Good account management is about showing your suppliers and customers that they are a valued part of your business. Once you’ve built up trust with your supplier, they’ll be more likely to forewarn you of any issues in their business. For example, if your supplier is planning on retiring, you’ll need plenty of time to plan ahead for this and find a new supplier. You don’t want to be chasing after people at the last minute, trying to find the necessary materials for your product. With your customers, the benefit is fairly straight forward. Putting extra time and effort into how you handle your customers will give you an edge over your competitors. They’ll feel value and be more likely to buy from you again in the future, which means more money for your business.

You may never have considered the importance of account management, but you’ve probably thought about saving and making money. Account management and money actually go hand in hand, which is why it shouldn’t be overlooked. It can be applied to both your customers and your suppliers to build up loyalty. Your account manager will be the first point of contact for queries, complaints or purchases. How they handle their role will help to define the type of relationships you have with customers and supplies.

Some tips for handling account management include:

For support on handling account management and supplier relations, get in touch with the Growth Hub. You may find that your staff could benefit from training on account management. The Skills Support for the Workforce is a programme that will cover all the costs of training. Alternatively, the Manufacturing Growth Programme is a grant that could cover some of the cost of a consultant to help support you.

Supply chain management

Supply chain management (SCM) is the oversight of the whole supply chain process, from checking materials and information as they move from supplier to you, all the way until they reach your consumers. By having more awareness of the whole supply chain process and tracking the materials from your supplier then your product to customers, you could see an improvement to customer service. By tracking transportation, you can ensure parcels are delivered to your customers at the right location and the right time. This will boost customer satisfaction and could lead to further sales.

Management Information Systems (MIS) can be a useful tool to help handle your supply chain. A Management Information System is a computerised database of all the important information about your business. The system continuously gathers data that you can access at any time to look at how well your business is performing. The systems can be tailored to your business needs and can report on things like: human resource management, manufacturing records, finance and accountancy details, consumer behaviours, and lots more. You can even use it to facilitate communication between your different members of staff through document sharing, work shift changes, or shipment information for example. This can help you stay organised and efficient and reduce the amount of time wasted chasing information.

Your Management Information System is special to your business and it’s a good idea for someone with excellent knowledge in IT to create it for you. If you get in touch with the Growth Hub, we’ll be able to put you in touch with people who might be able to help you fund the creation of your new system. We can also help you get your staff trained up to make sure it is being used to increase efficiency rather than baffling your staff.

For further support on handling your supply chain management, give the Growth Hub a call. It doesn’t cost you anything to have a quick chat about the problems that your business has been facing. In return, we’ll point you in the right direction for what possible funding could support you. For example, the Manufacturing Growth Programme provides a 35% grant to access consultants with knowledge on supply chain management.

Summary

A good supply chain can make or break your business. If you have a strong relationship with your suppliers, you’ll have more stability in your business and a chance to negotiate prices. For support on building supplier relationships, the York, North Yorkshire and East Riding Growth Hub is here to help. We’re a free service that is here to provide solutions – whether you’re looking for funding to invest in new technology or support to invest in expert advice, we can point you in the right direction. All you have to do is give us a call and we’ll do the hard part.

If your interested in finding our more then you can get in touch at support@howsbusiness.org