How Bangladeshi companies can maximise financial gains by collaborating with suppliers
Businesses can create win-win scenarios that benefit both parties by working closely with their suppliers
In today's globalised marketplace, businesses are facing unprecedented levels of competition. Companies must constantly seek new growth and success strategies to thrive in such an environment. One such strategy involves building strong relationships with both buyers and suppliers.
In the past, procurement was often viewed as a zero-sum game, where the buyer and supplier were engaged in a battle for the best possible price and terms. However, forward-thinking organisations now recognise that this approach is no longer tenable. Businesses can create win-win scenarios that benefit both parties by working closely with their suppliers and fostering a collaborative relationship.
To achieve this, companies must prioritise transparency, communication and trust in their relationships with suppliers. When the companies do so, they create an environment where suppliers feel valued and respected, which leads to better collaboration, more efficient supply chains and increased profitability.
They must also be willing to invest in building long-term partnerships that are based on shared values and goals. Ultimately, by working together in this way, buyers and suppliers can drive innovation, increase efficiency and create lasting value for all the stakeholders involved.
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The relationship between Apple and Foxconn is a thriving example of supplier collaboration. Apple partnered with Foxconn to develop and manufacture its popular iPhone product line. Through close collaboration involving frequent communication, data sharing, joint research and development efforts, they have established an innovative and highly efficient supply chain that produces millions of devices annually.
In the case of Bangladesh, supplier collaboration is vital for streamlining and optimising the overall supply chain arena. By working closely with their suppliers, businesses can gain greater visibility into their operations, reduce costs and improve efficiency. This collaboration can take many forms, including joint planning, shared risk, collaborative problem-solving etc.
Ultimately, by fostering strong and collaborative relationships with suppliers, companies in Bangladesh can create a more resilient and sustainable supply chain that delivers greater value to customers, shareholders and the society as a whole.
In many industries, the success of a company's supply chain operations heavily depends on the ability of supply chain professionals to collaborate effectively with their suppliers. These professionals must be able to communicate effectively, negotiate favourable terms and resolve any issues that arise promptly. By doing so, they can ensure that the company has a reliable and efficient supply chain that meets the needs of its customers.
The credit for maintaining a strong supplier collaboration should go to the supply chain professionals. Therefore, senior level management of the company should concede their contributions. Recognising the role of supply chain professionals in building and maintaining supplier relationships can help to foster a culture of collaboration and teamwork within the company. It can also help to attract and retain top talent in the supply chain field, which can ultimately contribute to the success of the company.
Overall, supplier collaboration offers companies significant financial benefits and opportunities to create long-term, mutually beneficial relationships with key suppliers. By prioritising collaboration and investing in supplier relationships, companies can improve their bottom line and position themselves for long-term success in a competitive marketplace.
In recent times, there have been several examples of successful supplier collaboration in Bangladesh. For instance, some manufacturers collaborate with their suppliers to develop more sustainable supply chains in the textile industry. By working together to reduce waste and improve energy efficiency, these companies are creating a more environmentally friendly and cost-effective manufacturing process.
Another example is in the construction industry, where developers are collaborating with suppliers to ensure timely delivery of materials and reduce waste on construction sites. By establishing clear communication channels and working collaboratively on project planning, these companies are able to optimise their supply chains and reduce costs while improving project timelines.
Moreover, companies in the food and beverage industry collaborate with their suppliers to develop new products that meet changing consumer preferences. By working together to identify market trends and consumer needs, these companies can bring innovative products to market that offer a competitive edge.
These examples highlight the importance of supplier collaboration in Bangladesh, and demonstrate the benefits of a collaborative approach to supply chain management. By prioritising collaboration and investing in strong supplier relationships, companies can drive innovation, reduce costs and create long-term value for all stakeholders involved.
Mapping and eliminating relationship pain points is a critical step in developing solid and productive business relationships. To accomplish this, companies must carefully assess their relationships with key stakeholders, including customers, suppliers and partners, to identify areas of friction or inefficiencies. By doing so, companies can take proactive steps to address these issues and create more streamlined, productive relationships.
Some common pain points that companies may need to address include communication barriers, misaligned expectations and a lack of transparency or trust. Through careful analysis and effective communication, companies can identify these issues and work collaboratively with their stakeholders to develop solutions that benefit all parties involved.
This approach can help to strengthen relationships, improve operational efficiency and drive long-term growth and success. Ultimately, by mapping and eliminating relationship pain points, companies can create more productive and sustainable relationships that deliver value for all stakeholders.
Technology enablement and data visibility are critical components of successful supplier relationship management. By leveraging digital tools and platforms, companies can gain greater visibility into their supplier networks, track performance metrics and identify areas for improvement. Additionally, technology can enable more streamlined communication and collaboration between buyers and suppliers.
For instance, cloud-based platforms can provide real-time data on supplier performance, allowing companies to track metrics such as on-time delivery, quality and cost. This data can then be used to identify potential issues or opportunities for improvement, enabling companies to proactively address them. Furthermore, technology can facilitate more efficient communication between buyers and suppliers, reducing the risk of miscommunications or delays.
Significance of supplier collaboration extends beyond the micro-level of individual companies and suppliers. At the macroeconomic level, effective supplier collaboration can have a positive impact on the overall economy by improving supply chain efficiency, reducing costs and increasing productivity.
When companies collaborate effectively with their suppliers, they can optimise their supply chains, reduce inventory costs and enhance the overall quality of their products and services. This, in turn, can lead to increased domestic and international competitiveness. By being able to offer high-quality products and services at a competitive price, companies can attract more customers, generate more revenue and ultimately contribute to economic growth.
Supplier collaboration can also help create jobs and increase labour force participation. As companies optimise their supply chains and increase productivity, they may need to hire more workers to keep up with demand. This can help reduce unemployment rates and increase the number of people participating in the labour force.
Mohammad Ashraful Islam Khan, formerly the Head of Supply Chain Advisory Services at KPMG Bangladesh, currently resides in Winnipeg, Canada. He is a passionate management consultant who specialises in growth strategy, operations optimisation, fintech, and supply chain management. He can be contacted at [email protected]
Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the opinions and views of The Business Standard.
