Supplier development and company competitiveness

Can supplier development enhance a company's competitiveness?

An increasingly dynamic and competitive market forces companies to change rapidly and innovate frequently. Few entrepreneurs realise that their source of inspiration and impetus for development, can be suppliers. An even smaller group has mastered the art of developing suppliers to make their own company more competitive.

Entrepreneurs tend to focus on developing purchasing competencies within their own companies - training employees, improving processes, building technological advantage and other development activities. Meanwhile, suppliers have a huge potential for innovation that can be used to further improve purchasing processes and reduce costs across the organisation, and investing in developing this potential can have a huge impact on a company's bottom line. After all, you could venture to say that, to a large extent, a company is only as good as its suppliers.

What is supplier development about?

We can define supplier development as the process of the buyer working individually with a particular supplier to improve the supplier's performance, resulting in benefits for both parties. However, it is vitally important that it is initiated and then led by the buying party, whose job it is to help the supplier by using its own resources, experience and knowledge. Development cooperation with suppliers can take the form of ad hoc activities or take the form of strategic programmes. The most common areas covered by a vendor development programme are:

• Reducing purchasing costs while maintaining supplier margins.
• Increasing the quality of materials, goods or services provided.
• Quality enhancement in the area of on-time delivery.

However, an important advantage of supplier development programmes is that the areas covered can be tailored to the specific business needs of the buyer. This makes it possible to achieve precisely defined goals with a high level of impact on market competitiveness. This is why it makes sense to invest in supplier development. We know how to do this and are happy to support our customers in this area too.