Essential Consultancy Services
The Supplier Relationship Lifecycle
A customer and supplier relationship starts at the first point of contact established either during a customer survey of the supply market, or perhaps following a marketing approach from the supplier, and extends through a formal termination of the relationship into any post contractual obligations either party may be under.
Assuming that a relationship is productive (i.e. results in the supply of goods and/or services), it is likely to pass through the following phases:
It is important that these phases are recognised from the outset so that the organisations have a common understanding of how the relationship is intended to develop, and that the contents of each phase are understood, so that a supplier understands the level of investment needed during selection, contract negotiation, and for operational reviews.
Agreement of an exit strategy prior to contract signing will help to ensure that practical contractual provisions are established to ensure continuity of supply during a transition phase. An exit strategy may also help both parties to appreciate the costs and consequence of terminating the relationship and hence the benefits to be derived making a relationship work!
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