Strategies for P2P Success: Nurturing Supplier Relationships in a Changing Marketplace

A key aspect of the Procure to Pay process is often only given slight consideration. The key I am referring to is supplier relationships. In the current P2P environment, it would appear that we are in a “sellers’ market” as opposed to a buyers’ market. We frequently read about shortages in everything from electronic chips to infant formula. Even basics such as wood, food products and medicines are often in short supply. As the basic economic principle of supply and demand takes hold, prices escalate quickly and continually.

In its basic form purchasing has always been an adversarial relationship. Corporations want the best quality for the lowest price and suppliers want to sell minimal goods and services for the highest price. Not long ago negotiations variables were standard and the number of active suppliers utilized often consisted of a few trusted partners.

With the introduction of sophisticated ERP software, purchasing negotiation variables expanded significantly and P2P processes took on new complexity. In addition, the continual flow of new rules and regulations creates a constant state of change for buyers and suppliers.
Considering the chaos created by technology, rules and regulations, labor shortages and goods shortages, it is mission critical to have solid supplier relationships if you expect any continuity in acquiring your corporate requisitions for goods and services.

To sustain quality supplier relations, you must be able to provide your supplier with simple in the moment digital access to the information they need to do their job. This includes but is not limited to rules they must follow, status of purchasing documents such as invoices and digital supporting information when resolving issues. If the supplier is your only source of critical goods and services you must ensure your payments are timely and accurate so the supplier can maintain their cash flow and remain in business.

SmartDocs assists many global clients in building and maintaining excellent supplier relationships by providing tools that ensure optimized automation, portals for digital inquiries by suppliers, digital audit trails, timely and accurate payments, and approval nudges. Give us a call.