Any relationship expert will say communication is the key to success, and the same holds true for the relationship between a company and its suppliers. Effective management of supplier relationships is dependent upon open communication between a company and its suppliers, but knowing this and executing it are very different. When communication with your suppliers breaks down, there are several things you can do to improve your strategy and re-establish critical relationships.
Supplier Relationship & Compliance
Supplier engagement is crucial to many business operations, especially compliance activities. For product compliance, you may rely on supplier product and part data to create the declarations needed to maintain access to lucrative markets.
Many corporate social responsibility (CSR) initiatives are also reliant on supplier participation, as companies must ensure effective due diligence practices are present throughout their supply chain.
Finally, vendor management and trade compliance require transparent supplier relationships to reduce reputational risks and facilitate the movement of goods between parties.
Improving Supplier Relationships When They Stop Responding
Companies frequently reach out to their suppliers with requests for information, and there will be periods of non-responsiveness. When that happens, it’s important to remember your supplier likely isn’t ignoring the request and may have a valid reason for not responding. A supplier relationship manager should ask themselves three things:
- What situation might the supplier be in?
- How has the supplier been successfully contacted in the past?
- Is the data in the request accurate and understandable?
With those questions in mind, follow these best practices to re-engage your suppliers.
Consider the Supplier’s Situation
A myriad of external factors can impact communication. It’s important you consider realities that could hinder your supplier’s ability to respond to requests (e.g. unrest, floods, labor shortages, etc.). For example, a 2020 National Law Review study of conflict minerals filings during the COVID-19 pandemic found that 11 of 14 companies that mentioned COVID-19 said the pandemic negatively impacted supplier responsiveness.
Beyond temporary disruptions, non-responsive suppliers may simply no longer exist. Suppliers come in all shapes and sizes. It’s possible smaller suppliers encountered hardship or were absorbed by larger entities and ceased operations or changed their name as a result. A small amount of research will determine if this is the reason for their unresponsiveness.
How much time have you given your supplier? Are they in a busy season? Some requests take longer to complete than others. It’s possible a supplier received your request and is trying to meet the requirements. Before following up, ensure you’re giving your supplier enough time to adequately respond. To reduce the burden on your supplier, send your requests long in advance of your deadline. For example, if your conflict minerals filing is due in May, reach out to your suppliers in January.
Suppliers generally designate specific individuals to maintain customer relationships. If a supplier is unresponsive, the contact data on file may no longer be correct. Suppliers also experience turnover and not all transitions are smooth. A departing contact may not always advise their customers of changes. It can be helpful to maintain more than one contact at a supplier. If only one contact exists, try to confirm the data is accurate before trying to engage again.
Supply chains are frequently global and just as you should be mindful of regional events, you should also be mindful of the language a supplier conducts business in. Review successful past communication to ensure you’re using the proper language. If attempting to make first contact, do some research. Reaching out to the procurement team responsible for acquiring the supplier, for example, should help you uncover the preferred language of the contact.
Create a Clear Request
Most suppliers receive hundreds of customer requests for data every year, which can make it difficult to identify and prioritize requests that need action. If your request is similar to past notices, or if you’ve made numerous unique requests of the same supplier, it’s possible your supplier assumed the request had already been addressed. To avoid this, try acknowledging the past request and establishing that your notice requires new action. For example:
“Thank you for your past submission. Please find enclosed a new request for part data on…”
The importance of a supplier’s submission should also be well-stated. Supplier data is necessary for many compliance activities, and you may need to change suppliers if they are not forthcoming with data. Reiterating this can help establish your request as a top priority for a supplier.
You may have knowledge of regulations and requirements, but your supplier may not. To reduce the burden on suppliers and improve responsiveness, you can leverage templates. This is common in conflict minerals data acquisition as the Conflict Minerals Reporting Template (CMRT) has become an industry-standard tool. When no template is available, be clear about what data you need and how your supplier should submit it.
Unresponsiveness on behalf of a supplier doesn’t necessarily mean they didn’t see the request — it may mean they think the request doesn’t apply to them. A part can have two separate unique identifiers: a client number and a supplier number. Ensure requests use the appropriate number so suppliers can properly check their records and submit data.
Additionally, some suppliers recognize their relationship with you based on specific plants or business units, and may not be familiar with the name of your parent company. Research the supplier account to determine how to identify yourself and improve responsiveness.
Reach Out in New Ways
Customer requests are a part of doing business for most of the world’s suppliers, and it’s unlikely a supplier is ignoring your request intentionally. If you’re experiencing difficulty with a supplier, send a note, make a call, or otherwise reach out to offer assistance. There may be some obstacle or confusion that is preventing the supplier from responding.
In some situations, it may be necessary to escalate your request beyond the contact on file. Review your account to determine if there is a supervisor or sales contact that you can reach. They will advocate on your behalf knowing unresponsiveness can lead to contract termination.
How Assent Can Help
Assent is the world’s leading supply chain data management solution provider, servicing over 500 companies, and enabling effective compliance and supplier relationship management. Our platform automates supplier engagement and is supported by a dedicated team of professionals to facilitate data acquisition and validation. To learn more, contact us at email@example.com.