What is Vendor Management Process?

Vendor Management is a term used for all activities that companies conduct to manage their suppliers. Vendor Management process includes onboarding the right vendors with proper pre-qualification processes, contract negotiation, management of finances, monitoring risks, and ensure payment & service delivery.

The process may vary as per the nature and requirements of the business but major key processes are common.

Importance of Vendor Management

Vendor Management plays crucial role in any business process. From selecting the right vendor to fulfill a business need at a required cost a strong vendor management system is needed. The right system with the right flow of process help to maintain a good relationship with that vendor to attain future business goals such as market competitive bids and profitable negotiations for the benefit of organization.

Vendor Management can make the entire supply chain effective that helps in providing quality products and services to customers on time.

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Benefits of Vendor Management

There are several benefits of vendor management, few of them are:

1. Improved Selection of Vendor

With proper implemented Vendor Management System, your company can collect a good and moderate pool of vendors from which you can select as per your need with many options in terms of quotations and quality

2. Documentation and Contract Management

Implementation of Vendor Management System gives your company a centralized platform to view the status regarding contracts and other crucial documents

3. Reduce Chances of Disturbances in Supply Chain

Vendor Management streamlines the entire supply chain which reduces the chances of disruptions in the supply chain through on time deliveries and payments.

4. Enhanced Relationship with Vendors

Implementation of Vendor Management helps in building and maintaining the relationship with vendors which gives several benefits for long run in future.