4 Significant Reasons Why Your Business Should Focus on Vendor Management
Having vendors or third-party service providers is a necessary part of your business in order to operate and provide the services and/or products to your customers. How you manage those vendors is up to you and your leadership team, but these 4 Reasons are only a sampling of the many reasons your business should have a vendor management solution in place.
- Increased Efficiency:
How many vendors do you manage? 10-20-50-70+? If you don’t have a process and program in place to manage a multitude of vendors, how can you possibly keep up with them? Here are some questions to think about related to efficiency in managing your vendors:
- When does their contract renew?
- When does their insurance certificate expire?
- When do you need to conduct an annual due diligence review to assess the risk they pose on your organization?
- Have their services changed that increases or decreases risk?
- Have your services or processes changed that increase or decrease risk?
To effectively reduce supplier risks, whether in terms of operations, unforeseen cost implications, or regulatory compliance, you need increased visibility. Vendor management can track your suppliers and provide the data you need to identify supplier risks so you can take the necessary steps to mitigate them, or choose an alternative vendor. You can easily verify supplier information, such as qualifications and certifications, track performance, and even look into the supplier’s financials to get a broader picture of their risk level in order to protect your organization.
When you have increased visibility, you can see invisible costs that you can then better control in order to save on costs. Additionally, having strong relationships with your suppliers, due to effective procedures and processes with a vendor management solution. VMS can help you to negotiate better rates and have access to discounts and incentives that can increase your profit margin.
Vendors provide value in the expertise and experience they offer; however, organizations must still maintain active oversight. It is important to remember that when a vendor performs a service or function, the institution bears ultimate responsibility for compliance. Because varying levels of risk remain with the institution that offers the product or service, a strong vendor risk management program is key to maintaining compliance and avoiding claims of improper service levels to customers.
VMS Software – Vendor Management Solution is a discipline that enables businesses to not only cut costs but also: control expenses, drive service excellence and mitigate risks…while gaining increased visibility and value from their vendors. Through LIMITLESS’s on-line software overall vendor management, as well as – vendor expense management, is accomplished by giving you absolute visibility into your vendors and spend. No matter what the vendor or type of service they provide – companies can have a comprehensive view into their: services, contracts, rates, terms, conditions and spends through this sophisticated web-based solution.
If you have questions about any of our VMS benefits contact us today at 866-504-4050 to learn more about our Vendor Management Solutions.