Many businesses work closely with vendors these days. Typical examples are customer support, repairs and manufacturing. The arrangement is laid out in a contract, but vendors may not follow through, either because of a mistake or by choice.
This breakdown in the relationship can affect a company’s ability to function. However, the business may be able to avoid these disputes by building and maintaining a strong working relationship with its vendor.
Tips for making it work
A strong working relationship is often key to success. This can be done by:
- Sharing information and explaining priorities: This enables the vendor and company to understand each other.
- Balancing commitment and competition: Every business needs reliable support of operations, and the vendor needs a commitment to them; nevertheless, seeking competitive bids before renewing contracts is good business.
- Building for the long-term: Constantly switching vending partners can impact quality while providing minimal financial gains.
- Allowing key vendors to provide insight: They are experts at what they do, which is why you hired them and may be able to suggest better solutions that give a competitive edge.
- Drafting win-win agreements: Healthy and successful partnerships are ones where both sides get what they need.
- Agreeing on value: The quality of service or product should be at a certain guaranteed standard, which the business can then reliably extend to customers.
Sometimes it does not work out
Unfortunately, business relationships do not always work out, even if there is a healthy relationship. If the company and vendor cannot amicably resolve a dispute, it can mean a breach and subsequent legal action. While this is not ideal, the priorities of the business still should be met, even if it means enforcing a contract or finding a more suitable vendor.