Vendor management is a process that enables an organization to take the appropriate steps to control cost, reduce potential vendor-related risks, ensure excellent service deliverability, and derive value from vendors in the long run. These steps include:
- researching the best suitable vendors
- sourcing and obtaining pricing information
- gauging the quality of work
- managing relationships in case of multiple vendors
- evaluating performance by setting organizational standards
- ensuring that the payments are always made on time
This is where digital vendor management software comes into the picture. A vendor management system is an online tool that acts as a one-stop solution to manage all operations related to the vendors ensuring improvement in efficiency and being a cost-efficient solution in the long run. Some of the benefits of using a vendor management system include:
Enhanced visibility
If you’re dealing with multiple vendors, lack of vendor management tools can cause issues with managing multiple contracts. You will have a hard time analyzing and reviewing all the contracts if you use manual methods. However, with an apt digital vendor management process, you can streamline the process of VMS Systems. You will have an overview of the status of all contracts with multiple vendors in one place. It can help enhance your decision-making capabilities as you have complete visibility over all your contracts in a digital, easy-to-understand format.
With an SAP-based vendor management system, you can get a clear understanding of what is working for your organization and what isn’t. You can analyze and compare the performance of all your vendors, including your past ones in a single place. You can measure the performance of new vendors in comparison to the old ones. You can then decide whether you want to continue with the new vendor or switch back to the old one. You can also take the necessary business decisions regarding your current vendors, based on whether they are beneficial to your operations or not. You can end or extend contracts depending upon the business value the vendors bring to your organization.
Improved vendor relationships
Maintaining a healthy relationship with vendors is the key to the growth of your organization. A vendor management system can significantly help you with the same. As you get enhanced visibility of business operations with all your vendors, you can collaborate with them better. You can have an open conversation with your vendors as you have information available to you in real-time. Things won’t pile up and result in unnecessary confusion or heated arguments as you can follow up with vendors at every stage. With a digital SAP-based vendor management system such as Crave’s Procure to Pay tool, you can get your orders executed on time, follow up on payments easily, or communicate with the vendors regarding order status at the slightest delay in order execution or deliveries. Your vendors, too, will be happy as their transactions with your business will be streamlined with minimum hiccups.
Minimized costs
It is said that time is money. A digital vendor management system can help you save both. With a vendor management system, you can efficiently utilize your resources due to real-time monitoring capabilities. The resources can be allocated as and when required. For example, if there is a delay in receiving a shipment, the employees that might be required to unload items can be utilized for other tasks till the shipment arrives. They need not keep waiting for the shipment to arrive and can focus on other tasks. Thus, your organization’s productivity can improve significantly. This ultimately helps you save time, money, and resources. Vendor management tools can prove beneficial in other such instances, and thus help save costs by ensuring maximum productivity at your workplace.
To get a clear picture of how your organization can digitally transform your vendor management process with Crave’s vendor management tools, you can directly contact us.