?? SRM (Supplier?Relationship Management) – The key to the success of the business! ????

Do you know how your favorite sneakers ????, video games??? or chocolates ?? are always in stock in these stores?

The?magic ingredient is Supplier Relationship Management (SRM)!

SRM is a way for companies to cultivate long-term relationships with suppliers to make sure that products arrive on time, undamaged, and at the lowest?possible cost.

Without SRM,?businesses run the risk of:

? Delayed deliveries – Customers take too long?to wait! ?

? Low quality goods – Dead on?Arrival! ??

? Increased costs – Spending money unnecessarily on?worst deals! ??

So?let’s get down to the nitty-gritty of SRM, its significance, and how the enterprises can ace it, one step at a time!

?? What SRM (Supplier Relationship?Management) means?

Pretend you own?a pizza shop ??

You will need the ultimate pizza making ingredients for the?best pizza in town!

? Fresh dough ??

? Tasty tomato sauce ??

? The best cheese ??

Now?what if your cheese supplier decides to skip a delivery? Or your dough supplier?delivers dough that is not good? ??

Your business is going?on its downward spiral, and patrons are not returning!

That’s where managing supplier relationships comes into?play.

Good relationship with suppliers = Good products +?low cost = Happy Customers! ??

SRM focuses on:

?? The right suppliers???

?? Deliveries on time??

?? Keeping?long-term partnerships alive ??

?? Easy to get the?best prices & quality ??

?? Industry & Key Statistics –?Why is SRM Important?

?? 80% of all supply chain disruptions are due to?bad supplier relationship.

And here are some?ideas you can cover in your content that are very rich with data: ?? Strong supplier partnerships help companies save costs by 15%! ??

?? Companies like Walmart & Amazon?are saving millions leveraging SRM to negotiate better deals. ??

Businesses with strong SRM programs are?2X more likely to deliver products on time.

? 58% of businesses report risk management of supply chains as their most important?challenge.

?? Companies lose?money, time and customers, if they don’t smartly manage their supplier relationships! ??

How?to Implement SRM – Step by step guide ??

Want to master SRM? Follow these 5 simple steps! ??

?? Step 1: Selecting the?Right Supplier

???Identify reliable and experienced suppliers ??

?? Visit reviews from previous clients and?their past work ??

?? Make sure they are able to deliver on your quality & delivery?requirements ??

? For instance: You have a burger house ???and you want your lettuce supplier to bring fresh leaves, not wilted leaves!

?? Step 2: Build Strong?Communication

?? Have regular contact, through calls,?emails or meetings ????

?? Tell others about your business expectations &?long term plans ??

?? Talk about potential challenges &?solutions ahead of time ???

? Example: Nike constantly communicate with the suppliers to ensure that its shoes ?? are made without issues and arrived on time.

?? Step 3:?Set Clear Expectations

?? Clearly define product quality, pricing, and?delivery schedules.

???Contracts & agreements are well understood by both parties. ??

?? Set KPIs (Key Performance?Indicators) for performance measurement ??

? Example: Amazon has heavy supplier contracts for the speed of delivery so?the products arrive in time every time! ??

?? Step 4: Keep the Relationship Healthy

?? Think of suppliers as business?partners, not vendors.

?? Negotiate and pay your?workers fairly ??

?? Don’t assign blame, work as a team?to fix the issue ??

? For Example: Apple?closely collaborates with the suppliers of the iPhone parts to make sure quality materials & innovations before they are going mainstream.

When considering which performance metric to cascade, keep in mind that only the best differentiators will lead to an improvement.

?? Step 5: Monitor &?Improve Performance

?? Monitor fastener suppliers’ shipping times, quality?of the product, and cost.

???If a supplier fails to meet expectations, discuss remedial measures.

?? Always have?a secondary supplier in case of disruptions! ??

? For example: DHL using AI-powered tracking systems, DHL can monitor the efficiency of a supplier and improve the logistics.

???SRM: Some Real-World Examples

1?? Amazon — The God?of Supplier Management ??

?? Amazon partners with tens of thousands of suppliers around?the world! ??

?? It has a tight rating system to keep only high-quality?suppliers in business.

?? This?is why orders from Amazon arrive so quickly! ??

2?? McDonald’s — Always Fresh, Always?On Time ??

?? McDonald’s runs supplier relationships?so tightly that their fries ?? always remain available!

?? They use local suppliers?so everything is fresh daily.

?? Which is why McDonald’s burgers?taste the same all over the world! ??

3?? Tesla?— Creating Cars at Hypersonic Speed ???

?? The production of electric cars by Tesla is?tied to battery suppliers. ??

?? It tightly?manages supplier relationships to prevent production disruptions.

?? This is how Tesla delivers its cars?on time! ??

?? SRM: Why Every Business Should?Have It?

In this fast-paced world, without SRM, the businesses cannot?survive.

??Quicker deliveries = Happy customers ??

? Low cost =?Higher Profit ??

? More quality?= Higher brand image ??

? Less risks = No?last-minute surprises?

SRM is the secret sauce ?? that?makes businesses go. Without?it, businesses would miss out on profits, hold up orders and let customers down!

?? Want to start a business? Supplier Relationships Are Just As Important As?Customers!

?? What is one product you always see on?store shelves? Share in the comments! ??

#SupplyChain #SRM #Logistics #BusinessSuccess #SupplierManagement #Retail #BusinessGrowth #Amazon #Tesla #McDonalds