What To Do If You Don’t Trust Your Supplier

Procurement management is as much about risk management as it is about sourcing for products and services. Having the key skills for procuring goods for your business helps, but it’s rarely enough. It’s one thing to land a sweet deal with the supplier, and another to keep it from disintegrating due to a lack of trust between both parties. Trust is the key currency for any self-respecting business today, and also the key to sustainable and enduring business relationships. Trust gives you a competitive advantage over your competitors as customers are more likely to choose businesses that are perceived to be trustworthy. It’s no wonder then that businesses are increasingly making trust a part of their company values.

As a business owner, do you trust the supplier from whom you are procuring services? If you don’t, you might find yourself worrying over every encounter with the supplier and having to triple check every transaction made. This is hardly an ideal situation for a business partnership, especially when it comes to procurement management.  A lack of trust can lead to cash flow problems for your business and even disrupt the whole procurement cycle, which then affects product supply and ultimately, your customers. That’s definitely a scenario that you would not want to face, so what are some of the steps to take when you find that your supplier is less than stellar in the trust department?

Ask around

The beauty of being in such an interconnected world is that practically everything can be obtained with just a click of the mouse button. The internet is always a good place to start when it comes to obtaining information, and this applies to procurement management as well. To find out more about the supplier in question, you could carry out an online search to see if you could glean more information through feedback from other businesses that have used the supplier’s services in the past. You could also look for the contacts of other businesses that have dealt with the supplier before, and would be able to give you honest feedback.

If you are unable to find any information on the supplier in question, it may be best to just cut your losses and stick to suppliers with which you are comfortable, as you would already know what to expect from them. Of course, the best scenario would be to avoid this situation altogether by doing your due diligence before procuring services from a supplier. It’s always good to visit their offices and review their offerings in person before making a commitment. Doing so allows you to cultivate a closer relationship with your supplier, thus engendering a partnership based on trust.

Identify and mitigate risks

One of the key skills for procuring a sustainable supply of goods and services is the ability to identify and mitigate risks to the procurement cycle. Efficient procurement management entails not only knowing your procurement cycle inside out, but also the key people involved, especially those from whom you’re procuring services from. Keeping track of all your suppliers to a T is a time-consuming process – not to mention nearly impossible – but you can develop a list of all the suppliers and segregate them according to risk levels, e.g. high-, medium-, and low-risk categories. High-risk suppliers could be those who have trouble keeping to agreed shipment schedules or do not meet product quality specifications, etc. These are the suppliers who pose the highest risk to your business as their actions can cause customers to have a negative impression of your brand and its reliability, and as such, should be monitored closely and subjected to all due-diligence investigations.

One way to keep track of supplier risk levels is to carry out thorough research on the suppliers across all aspects of procurement management and use those findings to develop an overall risk score. Alternatively, a rules-based approach could be used, whereby specific rules or criteria are developed for each segment in the procurement management process. Each supplier is then assessed against the rules and assigned their respective risk categories.

Another good practice in procurement management involves developing a comprehensive list of risks that could potentially pose problems for your business. Among the risks to take note of, include supply disruptions resulting from political or geographic events, brand and reputational risks, as well as the financial viability of business decisions. With this list in hand, you are able to take a proactive approach to procurement management by planning ahead to mitigate risks that could arise, instead of only reacting to problems when they happen.

Emplace an effective supplier relationship management infrastructure

With cost reduction being a key strategic driver for CEOs globally, it’s imperative that procurement management processes are streamlined and primed for maximum profitability and minimum risk. Another key skill for procuring goods and services that meet your business requirements is the ability to develop and maintain good business relationships with your suppliers. A supplier is not just another cog in the machine but rather, a key figure in the procurement management process that could determine whether your business sinks or swims. And usually, out of the many suppliers that a business may have, there are a select few who should be given more attention and care when it comes to maintaining a good business relationship.

These suppliers include those to whom you have outsourced your business’ internal processes either wholly or partially; those with which you have inked a joint venture to pool assets and resources to create value; and those who provide critical services or materials that have a direct impact on your business’ commercial differentiation, e.g. shorter market-cycle times, higher market shares or optimised business margins. Suppliers who do not meet agreed business terms and conditions can really wreak havoc on a business’ reputation and profits, hence the importance of an enhanced relationship with your suppliers as an effective procurement management practice.


It is important to keep a healthy trusting relationship with your suppliers as it is the key to successful business relationship. We, from ThunderQuote hope that this article has help you have a better insight on what to do when you are facing issues with your suppliers. Don’t hesitate to read more articles from our website.

ThunderQuote is the most comprehensive business services portal in Singapore, Australia and ASEAN , where hundreds of thousands of dollars of procurement contracts are sourced every month by major companies like Singapore Press Holdings, National Trade Union Congress and more.


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