Retail Hero: If the inventory is the business’s greatest asset then the supplier of that asset is equally important. Strong vendor relationships can build a business. Vendors are our partners. We must work with our vendors so that they become our allies in creating a strong bottom line relationship. Because of it we must be aware of performance and how the vendor compares with competing vendors.
Our information about a vendor should include the following:
- The system must track delivery information so that you know the percentage ordered by a vendor
- The system must be able to capture manufacturer reorder availability
- The system must be able to take advantage of electronic ordering (PO in e-mail, XML, other electronic data transfer formats)
- We must be able to identify best and worst performing vendors by flexible criteria
- The vendor markdown allowances should be accounted for
- The system should be able to suggest reorders of similar style from the lower cost vendors
- The system must be able to suggest reorders based on past sales or when exact reorders are unavailable.
Most likely you are not yet taking advantage of electronic purchase orders therefore the pile of paper on your desk keeps growing and it takes longer for your accountant to re-enter the purchase order information into the accounting system. Sometimes though, you may find yourself in a situation where you are incapable of tracking information about the vendors. This is a pitfall which leads to missed due dates, poor relationships with vendors, lower credit ratings, smaller discounts and other business problems. Take action now - you don't know what you are missing but your customers do.
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