4 Main Benefits Of A Supplier Qualification Audit You Need to Know

by Procurement Freelancers Team

When you are running a business, the last thing you would want to play with is the relationship between you and your suppliers. The modern-age simply talks about dealing with a supplier for handling pressure from the competition, rigid regulatory requirements, and rising customer demands. If you create a strong, healthy relationship with your supplier, problems from this side will be eliminated automatically. At that point, your business will be able to a great increase in overall productivity. Now, to ensure a good relationship with your supplier, it is essential to conduct a supplier audit. A supplier auditor is mainly responsible for conducting this to make sure the supplier is performing well in procurement and providing full safety with products and services.

Audits are a great thing in the world of procurement. They greatly help manage the whole of procurement by measuring all kinds of loopholes including delivery loopholes. A supplier audit includes the proper analysis and measuring of different sides of procurement to ensure compliance with industry regulations while avoiding any potential expenses that could rise from non-compliance. There are a huge number of ways for performing a supplier qualification audit but outsourcing the task can be considered one of the best alternatives. Now, keep reading to know why you need a supplier audit.

Why Your Business Needs A Supplier Audit

A supplier audit can be referred to as one of the backbones of your business. Since your supplier is the main source of your products and services, you never want them to perform badly for your organization. To keep a good track of them and their performance in the market as well as in your company, you need to have a supplier audit run. Now, read below to know in detail why exact your company needs such an audit.

Reducing Risks

Businesses are created on risky landscapes and, thus, they face different levels of risks. Some common risks can always be found in a business such as business continuity risks, reputational risk, quality risks, cost volatility, non-compliance risks, and safety risks. These are certain risks that are somehow tied to your suppliers. Thus, when you perform a supplier audit, it becomes easier to gauge those common risks. You can then easily reduce any kind of threat in your organization, especially for procurement. A supplier auditor does everything to ensure the safety of your business.

Nurturing Better Relationships

If your supplier is able to meet your business interests followed by your requirements, a great relationship can easily be formed. In many times, a supplier may seem to be promising that they will walk according to your expectations but in real, they do not seem to be the same. A supplier audit here cuts such problems off and ensures proper gauging of supplier strengths long before drawing a commitment to work with them. Such an audit always keeps your business safe.

Embracing Alignment In Complying With Standards

There are certain standards that your business needs to follow or comply with – such standards may include industry-specific standards, country-specific standards, and internal policies. These standards mainly extend to your third-party entities. If you now conduct a supplier audit, you can easily get unfiltered access to the compliance landscape of a supplier. Since a supplier’s non-compliance can result in fines and reputational damage for your company, ignoring it should keep no question. Provide your suppliers with a set of requirements before auditing them live for meeting the requirements. A supplier auditor here runs the audit in a way that there is proper compliance with standards throughout.

Improving Customer Satisfaction Levels

The up and down of customer satisfaction levels fully depend on your suppliers and their reliability. For example, delay in order delivery can make any customer angry all of a sudden. Further, if there is any defect in a product or service, a customer would again get angry. This will lead them to avoid your business for taking any further services. If you conduct a supplier qualification audit, it can easily assess their error-making strategies and accordingly, address them to be efficient in work. This would help you higher the rates of customer satisfaction. Such an audit greatly helps your business eliminate the guesswork while working with your supplier.

Suppliers are one of the most important keys who are meant to take your business to success. But proper management of them is always extremely important to reach the top. Make sure your supplier auditor is doing all the possible things with the audit for the betterment of your business as well as procurement. A supplier audit forms an organized environment in and out of your company to ensure proper functioning and coordination between you and your supplier. If you are looking forward to creating a great relationship with your supplier, start running effective supplier audits now!

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