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The Importance of the Supplier Relationship in a Supply Chain Crisis


During recent times the world has been experiencing a supply chain crisis. Such crises start local and very quickly become global.

The traditional relationship between customer and supplier, in general terms, was that of the latter trying to sell to the former. The Supplier was doing much of the effort to ensure that the customer would buy the desired part of his raw material supplies for his production, from this supplier and some other competitor.

The supply chain crisis turn this on its head. Suddenly there was shortage on everything: capacity, transportation even packaging. Customers were running hastily to secure their raw material needs in order to secure their production and sales.

However, that was proven to be not that simple as it was in the past. On the contrary, it was a very complicated and difficult process. It was, one might say, almost impossible. Consequently, customers were left short of raw material, production was forced to stop and customer orders cancelled or postponed indefinitely.

This brought to light the importance of the relation to the Supplier. Since suppliers were forced to allocate their capacity, they started to evaluate more things that in the past were on their priority list. Qualitative analysis came over a quantitative one.

They started looking at things like:

  • Loyalty
  • Continuity of business
  • Payment punctuality
  • Accurate well in advance planning and forecasting
  • Ease of communication
  • Mutual understanding
  • Common values
  • Common purpose
  • Connecting people
  • Infinite Mindset

Essentially the Supplier was transformed into a partner and not just someone you buy things from.

Your partner has depth understanding of company strategy, purpose, short and long terms goals. In addition he understands- and at best share- your values, your people, the way you do business. In this way, they will walk along with you and not behind you or in front of you. They will support you and care for you.
And of course you will do the same for them.
A partnership only works if it is mutual.

The crisis is still on going and this may well be a more permanent change on how we go about doing our business and manage our supply chain. Yes, it difficult to shift your mindset with regards to your Supplier relationship. It is not easy to do that during these rough times. But, there is no way round it. You need to start changing your company’s mindset with regards to supply chain.
Is not the perfect time? But, then again, when will it it be? Only good things can come out of such a shift. Find the right partner for you and your business and start talking and more importantly listening. Adopt a infinite mindset for this relationship.

This will bring value to the supplier, your people, your business, your company.

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