Key Strategies for Reducing Supply Chain Risk Through Smarter Tender Management
Managing supply chain risk is essential to maintaining stability in business operations,
especially in today’s dynamic global market. Smarter tender management can play a pivotal
role in reducing these risks by fostering resilience and reliability throughout the supply chain.
Here are key strategies to achieve this:
- Preferred Suppliers Only: Prequalify suppliers to ensure they meet the required
standards for insurance, indemnification, licences, product availability, and
financial stability. NB: ensure your system has a simple method for automatically
tracking and notifying you and your suppliers about the expiry dates for all the
required accreditations. - Identify Hidden Risks: Off-contract and non-core purchases can have a
significant impact as much as your core business purchasing – particularly if
there are no insights and controls in place. Having a simple system that manages
and tracks all frequent purchasing can provide valuable information when
strategic and/or fast decision making is required. - Diversification of Suppliers: Relying on a single supplier can be risky. By
diversifying the supplier base, businesses can mitigate the impact of regional
disruptions or a supplier’s failure to deliver. - Make it Easier to Engage New Potential Suppliers: Ensure your process for
onboarding new suppliers is simple and streamlined to avoid over-relying on the
same vendors and to be able to seize new opportunities. - Balance Cost Control with Other Considerations: While controlling costs is
vital, so is product or service availability, geographical coverage, upstream
impacts on supply, and maintaining a healthy competition amongst potential
suppliers. This ensures flexibility to switch if your primary choice becomes
unavailable or compromised. - Clear Contractual Agreements: Drafting comprehensive contracts with clear
terms and conditions helps manage expectations and reduce legal risks. This
also ensures that both parties understand their responsibilities during disruptions,
and having all these documents easily at hand ensures simple resolutions if
needed.
Applying these strategies together helps you create a resilient supply chain ensuring you
are capable of adapting to change.
We would love to hear your thoughts on what other factors should be considered and what
their potential impact could be?
Talk to us via the request contact for more information about our easy, fast and affordable solution.
