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3 Ways to Improve Your Supplier Relationship

The buyer-supplier relationship can feel strained at times because so much depends on performance and orders moving smoothly. As a buyer, the development of your product and its assembly are completely dependent on your suppliers. The stronger your communication is with your suppliers, the stronger your relationship will be.

One of the biggest challenges to the buyer-supplier relationship is communication. 

If you’re like most buyers, your procurement team probably uses multiple platforms to communicate with suppliers. These platforms can include email, phone calls, texts, and fax. While your business can function with this system, the margin of error in your purchase order operations is high. Errors can include anything from missed PO acknowledgments to operating with inaccurate PO details. Every hiccup in your PO, AP, or RFQ process puts the buyer-supplier relationship at risk and can lead to late deliveries.

With this in mind, we’ve created a list of 3 ways to improve your supplier relationship and your ability to communicate with them.

1. Invest in a Supplier Collaboration Software

Building a relationship with your supplier may not involve face time, but it should always involve collaboration. Managing purchase orders, accounts payable, and RFQs across multiple platforms makes your supply chain vulnerable. Missing details on POs can have a severe impact on your ability to get deliveries to your customers on time. Collaboration solutions, like SourceDay, seamlessly connect buyers and suppliers in a single platform where all interactions are archived in real-time and available for both parties to see.

Through our solution, both buyers and suppliers can track every part of the PO process and communicate in a single dashboard. Alerts, notifications and even color-coded flags ensure nothing gets missed. Using SourceDay, buyers have experienced a 35% increase in on-time deliveries.

2. Make Your Software Accessible to Suppliers

For effective collaboration between buyers and suppliers, your suppliers have to adopt the same software that you are using. With SourceDay, buyers pay for the license, and their suppliers access the software for free. Suppliers are then able to streamline labor-intensive tasks, quickly acknowledge POs, and ultimately, get paid faster.

Plus, SourceDay provides all the necessary training for buyers and their vendors, making the transition simple.

3. Give Your Suppliers Feedback

Suppliers care about their service and want to know how they’re doing. Effective service leads to loyalty. SourceDay’s Supplier Scorecard solution streamlines grading vendors so you can quickly relay the good and the bad as far as their performance.

With SourceDay’s quality control dashboard, you can easily track the incoming inspection of supplier materials to determine if specifications are met. If the materials fail inspection, suppliers are quickly notified through the platform and the failing materials are then dispositioned. After the issue is resolved, buyers can score the interaction, giving suppliers an incentive to take care of any problems quickly.

Improving your supplier relationship starts with using the right tools. Updating your purchase order process by using software like SourceDay allows you to improve your communication with suppliers and meet more commitments. Learn more about SourceDay’s solution and chat with a member of our team!

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Drawing the Line Between Direct and Indirect Spend

Why is it important to know the difference between direct spend and indirect spend?

Managing both requires different skillsets and tools. We often tell our customers that direct spend, or direct materials procurement, is about supplier management and performance. But, indirect spend is about managing buyer’s spending behavior.

Direct Spend refers to the money that goes into raw materials and goods, or COGS (Cost of Goods Sold) to create the product.

Indirect Spend is the ‘back office’ purchases for the operations of the business. For example, chairs or whiteboard markers for the office.  

To put it simply, direct spend impacts your customer.

A lack of parts or supplies can shut down your business. Issues in your direct spend procurement can cause stock outages, drive up labor costs, hinder business goals, and impact customers. Real-world examples of this include the recent global descaling of Ford plants or KFC ‘s chicken shortage in the UK last year.

Problems with indirect spend play out differently though. Production is rarely stopped due to incomplete or unreceived purchases. The fact is, you can’t afford to have issues in your direct spend procurement because it impacts your customers and your ability to stay in business.

There are unique problems inherent to direct spend procurement that don’t appear in indirect spend. Understanding the difference between the two types of procurement can help you prioritize the items that should be top of mind in running your business.

Direct Spend vs. Indirect Spend

Direct Spend


  1. Refers to the purchase of any good & services used to create the product

  2. Issues directly impact production and customers

  3. Focuses on changing supplier behavior to meet more commitments

  4. Accustomed to managing changes to POs

Indirect Spend


  1. Impacts day-to-day needs for operating the business

  2. Issues only impact the business internally

  3. Focuses on changing buyer’s spending behavior within an organization

  4. Not accustomed to large volumes of changes to POs

Unlike indirect spend, direct spend systems are designed for managing changes to POs. Because even the smallest unacknowledged change can prevent the customer from receiving their order. Cloud-based, direct spend solutions like SourceDay are built to manage change. Our platform is designed to help buyers and suppliers work collaboratively using real-time information to grow their businesses.

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