Email
sinha.rk.dr@gmail.com
Supply Chain teams often suffer from vendor reliability issues.
Vendor reliability, in terms of timing, quantity, and quality has been a cause of concern in many companies. The problem has got accentuated as the markets became more volatile and unpredictable. Teams often undertake large scale vendor partnership programs to improve their reliability.
How should we approach it?
My experience in working with many companies across industry sectors suggests that the first and the most actionable root cause is often internal. We know that vendors also face product availability issues, just like the sourcing companies. In such situations, how do they decide which company to prioritize? The decision is often intuitive and favours the company which always pays on time.
Have you analyzed your company’s payment performance? Do we pay our vendors on time in full on the due dates? Many leading companies have this OTIF score of as low as 50%. If we want vendors to supply on time, we must pay them on time.
If we improve our payment OTIF, vendors will improve their supply OTIF.
Would love to hear your experiences in this regard…