A business should use the right procedure in its supplier onboarding to ensure success. This is because various challenges that can hinder the vendor onboarding process such as the suppliers being unwilling to go through with it, lack of proper know-how of the way to do it or ineffective onboarding system. The aim is to onboard suppliers fast so that you can start doing business.
Both the buyer and supplier experience challenges in the onboarding process. The buyer needs a system that can accommodate and communicate effectively to many suppliers. On the other hand, vendors wish for a system that allows for quick response to various requests. The process can be hectic with the exchange of information between different departments of each company. However, an onboarding process that is implemented well can ensure reduced costs and higher participation by suppliers. To make sure that a business successfully onboard its vendors and fast, here are the steps it should follow.
Assess supplier risk. A business should weed out risky suppliers and choose eligible ones. For instance, a vendor should have all the documents required in running the business, have financial stability, supply quality goods or services and strong management. You should verify new suppliers thoroughly using workflows and checklists. These should be applied to all departments and systems.
Inform the supplier of the importance of onboarding. Some may be reluctant to go through the onboarding process. It is your role to show them why they should join the system. Discuss the benefits such as faster payment processing, reduced manual processes and forecasting demand.
Start the onboarding process. The process involves collecting supplier information and storing it in the company's system. The process can be automated to make it easier for suppliers to provide documentation using the online portals to save time and labor. For instance, suppliers can send documents such as NDAs, financial reports, and minority certificates online.
Check the data quality. The quality of data provided by the supplier may affect the business. A wrong email address or telephone number can delay transactions or be a source of fraud. To avoid the consequences, validation rules and quality regulations should be applied. That way, the business will have accurate, validated and up to date supplier information.
Complete the onboarding process. Once the vendor has provided the required information and it has been validated and verified, then the onboarding process can be considered complete, and trading can start. The supplier information should also be used even in other departments to ensure uniformity in other systems.
Uniform onboarding. For a global organization or one that has branches in different locations, the success of the onboarding process can be achieved when there is uniformity. This way, the whole organization can benefit by having accurate and validated supplier information.