Supplier Development makes you competitive

Supplier Development makes you competitive

There is a growing recognition that supply chain performance possibly influence in the competitiveness of your company, in this way, many  organizations are increasing their interest about supplier development strategies, which include, the suppliers evaluation, selecting the best suppliers, making efforts to develop suppliers performance and capabilities, improving customer-supplier relationship, etc.

Supplier development is a process which includes any set of activities that a buyer (a company) undertakes to improve the supplier performance and capabilities, in a way that generate favorable results for both parties in a long-term. The buyer should design a Supplier Development Program, which require an investment of time, money and space from both parties (the buyer and the supplier); this program may result in an improvement in the supplier performance and, consequently, in a strengthening of the buyer´s competitiveness.

There are some elements that appear to be critical to the success of a Supplier Development effort:

  •        Effective two-way multifunctional communication.
  •        Top management involvement
  •        Cross functional buying firms teams
  •        Price versus the total cost of ownership
  •        Long term perspective
  •        Supplier evaluation
  •        Supplier recognition

A supplier Development effort represents an initiative that can help the firm meet strategic organizational objective. In the one-page picture I´m adding to this post, you can also find other activities that can help an organization to reach competitiveness.

Supplier Development

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One thought on “Supplier Development makes you competitive”

  1. Nice blog! As our actual research on Mercadona shows us, they have to work closely with their suppliers to be and stay competitive. One of the first steps Mercadona does after choosing a supplier is to get to know him very good and share all essential information. Having a common base allows the purchaser (in this case Mercadona) to improve and develop processes together with the supplier to get more efficient.

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