The challenge in today’s marketing-saturated businesses world is picking the right approach to vendor management. There is no dearth of vendor management solution out there nowadays, you can select from a range of comprehensive procurement solutions as well. 

A key stakeholder in any successful enterprise is the vendors they deal with, which takes a lot of consideration to ensure that the company is maximizing the value they are getting out of the relationship with the vendors. 

Let’s explore more about vendor management solutions. But before we get into the comprehensive discussion, 

let’s begin with a quick recap at the basis of vendor management solutions. 

What is vendor management system? 

Vendor management is said to be the business’s internal structure for dealing with the external vendors as well as suppliers, the suppliers can be of vital services like healthcare or nonessentials like office supplies. The businesses partnership with vendors is of the crucial importance and establishing an effective system for dealing with them will lead to sales generation. And the VMS systems are generally the software suites that basically helps the business and organizations take care of processes involved in the vendor management process. From initial contact to final closure of a deal or establishing a business relationship. In the modular approach, they have specific apps or modules, that takes care of processes like vendor onboarding or vendor payments. The software provides effective communication channels followed by task management tools and organizes vendor payments, expenses and contracts, that too using a single system.  

The vendor management system serves three main functions: 

• Vendor management- 

Generally, effective and accessible communication channels that help in quick and seamless interaction between managers and the contractors they deal with. 

• Project management- 

The project management tools conveniently assign the task, process tracking, work coordination, and other functionalities of agile project management and collaboration platform. 

• Payroll Management-

Simple and efficient processes to organize vendor and contractor payments and expenses. 

Top vendor management system– 

1: Tipalti- 

This award-winning global payment automation solution is your payroll and supplier management system, and more. Tipalti, allows you to organize the administrative side of employee vendor and supplier payments, from online onboarding to tax compliance, in online cloud-based solutions. 

2: Connecteam- 

A mobile-first solution for managing and engaging vendors and workers. It involves a comprehensive manager dashboard, pre-made templates, workflows, built-in time clock with geo-tagging capabilities and extensive integration with payroll management systems. 

It’s generally for the small to medium businesses looking forward to managing and communicating with vendors.

3: Lystable- 

This tool is for managing projects with the freelancer’s team, issuing payments, managing invoices, tracking vendors performance and qualification. It’s accessible online and enables the vendors to manage and update their profiles. It’s suitable for the companies that are employing around 50 freelancers or vendors, for project-based work and need an internal directory, project management tools and invoicing capabilities. 

4: eBid Systems ProcureWare-

ProcureWare is supplier management, sourcing, bidding, and contract management software-as-a-service. The supplier management feature supports the creation of a customized supplier self-registration process, that allows the centralized access toa searchable updated, supplier database. 

This is suitable for the organizations looking to automate vendor diversity. 

5: Beakon- 

For small businesses, beakon is a modular system to manage the safety, risks and other aspects of contractor employment. Also involves modules for auditing, vendor training and even visitor management. 

Beakon is best suitable for the businesses working in highly regulated and high-risk industries that also includes aviation, transport and services, and healthcare provision. 

Why should business integrate vendor management systems into their processes? 

By having a proper vendor management system, businesses and organizations can experience the following benefits: 

1: Better selection-  

Your organization can benefit from a wide selection of vendors, resulting in wide choices and better costs, by implementing proper vendor management in place. 

Your organization can be beneficial from a bidding war between vendors while ensuring that you get your money’s worth. 

2: Better Contract Management- 

Lack of vendor management system in a multi-vendor scenario elevates the issue of managing contracts, documentation, and other vital information in your organization. 

By implementing a proper vendor management system, the organizations can benefit from a centralized view of the current status of all the contracts and other important details which helps your organization to achieve better decision-making capabilities and save time. 

3: Better performance management-

Generally, an integrated view of the performance of the vendors is achieved by implementing the vendor management system. It provides a clear picture of what is working and what is not. 

This improves efficiency, which ultimately improves the overall performance of the organization. 

4: Better Vendor Relationship–

As we know, it’s not that easy to handle multiple vendors at a time. The reason being, some vendors may prove really fruitful, faithful, but not all. Managing relationship among the vendors is essential for successful project completion. 

So by getting the vendor related information in a single place, that you benefit from getting all the required information ultimately influences your decision-making process, thereby simplifying it. 

5: Better value- 

The objective of the vendor management system is to get the most value of your buck ultimately. So, by properly implementing the vendor management system can be fruitful in long term savings as well as improves earnings over a time period. 

What are the vital features of the vendor management system? 

Here, explore the range of full must-have features with us that contributes to the popularity of VMS’s. 

1: Dashboard- 

The dashboard showcases all the active contracts and updates you on the progress of each. And also ensures that the work is unhindered. 

2: Assign contracts- 

The built-in rating system involves vendor ratings as well as the customer reviews which helps you assign contracts to the vendors depending on their performances. 

3: Maintain contacts-

Based on the kind of the project we can modify or add new vendors information and their work with it. To improve the efficiency we can assign individual employees to vendors. 

4: Rate vendors- 

Helps you define specific performance indicators, and evaluate vendors periodically. You can also rate them by the service quality, delivery time and other factors as well. 

5: Reminders- 

Enables you to set reminder rules and dependencies to automatically notifies remedial activities they haven’t completed their activity till the given deadline. 

6: Faster Vendor Onboarding- 

Simplified registration, feasible, and intuitive interfaces in the application helps the suppliers to get on board in a minimal period. 

7: Centralized data-  

POs and PRs, contracts and other confidential vendor related information is stored in a centralized place which enables the users to easy and seamless access to data. 

8: Corrective actions-

When the supplier performances slip up, the businesses can initiate the supplier corrective action plan (SCAR) or they can also offboard them from the portal. 

9: Time and cost material basis:- 

Build ERP solutions for your businesses and enterprises by hiring Matellio on the flexible and material basis in order to ensure you have a team that adjusts to your changing requirements. 

In a NUTSHELL 

This blog post talks about the essential aspect of organizational functioning- vendor management, benefits, and features of the vendor management solution. In today’s era of the global economy, where geographical and economic barriers are diminishing, organizations have to work with various types of vendors from all around the world. Even if there’s a single vendor, there should be a proper and effective vendor management system because their performance ultimately affects the performance of the organization. 

Moreover, it is very crucial to understand the benefit and features of the vendor management system in order to design an effective process that will guide your engagement with the vendors.