A vendor is a person, organization (usually with a business name), or some other legal entity that makes goods or sells its services to a consumer or other business owners.
Vendors are crucial to the supply chain, facilitating the sourcing, production, and distribution of goods and services.
Difference between vendor and supplier
|Ser No||BASIS FOR COMPARISON||VENDOR||SUPPLIER|
|1||Meaning||Vendor is an individual or entity, who sells goods and services for a price to the customers.||Supplier is the one whose work is to provide the good or service required by the business.|
|3||Supply chain link||Last||First|
|4||Objective||To sell the goods to the final consumer.||To make the goods available to the people who need it.|
|5||Purpose of sale||Use||Resale|
Client references, service provider references, partner references.
Is the process that empowers an organization to take appropriate measures for controlling cost, reducing potential risks related to vendors, ensuring excellent service deliverability and deriving value from vendors in the long-run.
Third party vendor management
Third-party vendor management consists of all the processes necessary for a company to monitor and manage the interactions with its third-party vendors.
Vendor management system
Is a software suite that helps businesses take care of vendor management processes end-end, from initial contract to final closure of a deal or while establishing a business relationship.
Vendor management process
Is a series of strategic and tactical activities that companies use to manage and collaborate with vendors.
Vendor management program
Is a set of tools, processes, workflows, rules and guidelines to ensure that vendor relationships provide the intended benefits to the organization without bringing excessive risk or causing harm the company business.
Why vendor management is important
To ensure that vendor relationships provide the intended benefits to the organization without bringing excessive risk or causing harm.
Vendor selection criteria
Price, Quality of Product or Service, Check References, Customer Service, Ethics and Integrity of The Vendor, Flexibility & Delivery Time, Recommendations from Others, Existing Relationships
Supplier risk refers to any risk relating to the operation or organisation of a supplier that may potentially have a negative impact on the activity of a client company
Vendor risk assessment
Is a risk management discipline that focuses on pinpointing and mitigating risks associated with vendors.
Is the strategic process of reaching an agreement that is mutually beneficial for the company/business
Vendor Agreement is a legal document which stipulates the provisions regarding the work performed by the vendor.
It is a contract which specifies the conditions regarding the performance of certain work.
How to improve vendor relationships
- Try to Understand Your Suppliers
- Realize that timely payments are crucial
- Detailed agreements make supplier relationships easier
- Limit the number of vendors you use (change relation type to partnership)
- Establish a Clear Communication Channel
How to improve vendor management
Share Information and Priorities, Build Partnerships for the Long Term, Negotiate to a Win-Win Agreement, Come Together on Value, Express Clear Expectations.
How to evaluate a vendor
Establishing Performance Indicators, Classifying Suppliers, Centralizing and Integrating Data, collaborating with Suppliers for Review/ Feedback, Creating an Actionable Plan.
How to be a vendor
If you are a potential client and find interest in being part of our successful journey, please click here for Vendor Application