How can you make your supplier contracts mutually beneficial?

In the contract review detailed scope and all techno- commercial parameters need to be discussed. In case of commercial detailed cost breakup it should be benchmark with market with fix and variable parameters. It will help the next contract review .

One thing to keep in mind around supplier contracts is that the goal is not to WIN in the deal. the goal is to create transparency around your partnership with your supplier. If both parties agree that the goal is to lay the ground rules for how to work together, it becomes easy to find mutually beneficial agreements.

We create mutually beneficial supplier contracts through a proven approach: Experience: We partner with suppliers experienced in manufacturing similar parts. Pricing: We establish a mid-range price based on our gauging mechanisms and comparative quotes. Fair Margins: Ensure suppliers get good margins, unaffected by minor cost fluctuations. Commitment: We release purchase orders for at least 6 months to plan better. Ample Lead Time: Sufficient lead time prevents rushed deliveries, reducing errors. Problem-Solving: Collaboratively address rejections, finding solutions to root causes. Our approach builds trust, benefiting both parties in long-term partnerships. For more insights and to connect, visit my LinkedIn profile.

Our negotiations are founded on respect and ethical boundaries: Respect Margins: We never intrude on supplier margins, recognizing their financial commitments. Guideline Pricing: Our approach ensures fair margins without squeezing. Transparent Revisions: Prices are revised transparently when costs fluctuate. Two-Way Fairness: We uphold reciprocity, respecting supplier boundaries. By valuing supplier margins and staying within our limits, we cultivate ethical and enduring partnerships. Do leave a LIKE if you find this insightful !

Our approach is clear and effective: Clear Communication: We provide detailed dimensions during discussions to maintain critical tolerances within 70%. Team Collaboration: Multiple team members engage with suppliers to ensure communication is not reliant on a single point contact. Quality Partnership: We connect suppliers with quality team for collaborative efforts during PPAP and Quality Plan stages. Structured Resolution: We avoid unnecessary rejections, holding meetings involving key stakeholders to resolve quality issues. Open Access: Our suppliers have direct access to our top management for swift issue resolution These practices ensure lasting, efficient, and respectful partnerships. Do leave a LIKE if you find this insightful!