Managing Vendor Relationships with Accounts Payable Automation

Vendor management is a cornerstone of your business operations because it ensures that you get the products and services you need to keep your systems moving and customers happy. But sometimes, managing vendor relationships can be easier said than done. Here are some common obstacles that damage interactions with third-party providers and how Accounts Payable Automation can help solidify productive vendor relationships.

The Key to Strong Vendor Relationships: Keeping the Lines of Communication Open

When you keep the lines of communication open, you help eliminate miscommunications that can strain the relationship. It’s best to always provide too much information, as opposed to not quite enough. In many situations, this involves enhancing the visibility between your vendor and your processes. With accounts payable automation, you can quickly surface important information regarding each vendor you do business with, making it easier to communicate key information.

Obstacles That Impact Vendor Management

Here are the most common culprits behind poor vendor relationships. In each case, the issue can be better handled using a simplified, automated management system equipped with the information you and your vendors need to share.

Unclear Product Specifications

Unclear product specifications can feel like a violation of trust, especially when you’re expecting certain features and using them to make business decisions. But when the specifications of a product fall short, or they’re never clear in the first place, it’s nearly impossible to confidently make a purchase.

On the other hand, you can include product specification details in the notes section of your accounts payable process. In this way, you can clear up misconceptions about what products are supposed to do ahead of time.

Poor Quality Products

When product quality falls short of your expectations, it’s only natural for the relationship between you and your vendor to become strained. Therefore, it’s best to get a detailed, tangible picture of the quality of the product long before you commit to a purchase. Then, if it falls short of your expectations, you can still salvage your relationship with the vendor by providing helpful feedback.

Late Deliveries

When products you order arrive late, it throws off a range of other timetables. This can impact everything from production schedules to when, and if, you can serve your customers. That’s why it’s best to clearly communicate when you expect a delivery to arrive, as well as set up a system that enables a vendor to easily inform you of delays.

Late Payments

Late payments can also disrupt important timetables, particularly if the funds one party is expecting to receive have already been earmarked to pay for something else. For a vendor, who may be literally banking on timely payments, this can be especially frustrating. But with an automated AP system, you can avoid late payments, ensuring better relationships with those you have to pay.

How AP Automation Can Build Better Relationships

An automated accounts payable system takes a lot of the manual labor, which can result in mistakes, miscommunications, and delays, out of the picture. As a result, you can use AP automation to strengthen your relationships with vendors. By including information pertaining to the purchases you make from vendors, as well as when any deliveries need to arrive end product details, you put yourself in a position to clarify potential miscommunications early on. Explore more here