- Vendor relationship management is a process that helps businesses build and manage relationships with the providers they choose to buy SaaS from, usually through vendor relationship management software.
- There are a few reasons why vendor relationship management is so important. First, it allows businesses to negotiate prices and terms of service. Second, it allows businesses to get the products and services they need in a timely manner. Third, it helps businesses to build a relationship with the provider, which can lead to future business opportunities.
- Some vendor relationship management best practices include starting with the right VRM in your SaaS stack, creating vendor scorecards with KPIs, and learning more about your vendors.
- Mastering vendor relationship management is essential for any business that buys SaaS. Quolum’s suite of SaaS management solutions makes it easy to manage your SaaS subscriptions and spending and re-negotiate contracts with vendors on your terms.
When it comes to SaaS buying and management, many small businesses don’t have the time or expertise to evaluate and research the different providers on their own. They need help. That’s where vendor relationship management (VRM) comes in. VRM is a process that helps businesses build and manage relationships with the providers they choose to buy SaaS or other products from. It ensures that the businesses are getting the best possible value for their money and that the providers are meeting their needs.
Vendor relationship management is an important skill for any business that buys SaaS. It can help you to find the right provider, determine what services the provider can offer, and ensure that the provider is meeting your needs. By mastering VRM, you can ensure that you get the most value for your money across the board.
In this article, we take a close look at why vendor relationship management is so important and give you valuable tips on how to master it.
Vendors and Suppliers: Aren’t They the Same?
When comparing vendors vs suppliers, most people notice that vendors and suppliers often fulfill similar roles, but there is a distinction between the two that is important to remember. Vendors are often resellers, while suppliers are the first party that provides the goods or services. A vendor relationship is a business relationship that exists between two organizations. A supplier relationship exists between a supplier and a customer and requires its own supplier relationship management.
A vendor relationship is important because it allows businesses to negotiate prices and terms of service.
What is vendor relationship management (VRM)?
Vendor relationships are quite simply one of the most important aspects of a business. By understanding how to manage vendor relationships, you can ensure that you’re getting the best possible deal. It helps businesses build and manage relationships with the providers of SaaS.
There are a few reasons why vendor relationship management is so essential in the modern business environment:
- It allows businesses to negotiate prices and terms of service.
- It allows businesses to get the products and services they need in a timely manner.
- It helps businesses to build a relationship with the provider, which can lead to future business opportunities.
Tips for Vendor Relationship Management
Does your company already have its own vendor relationship management strategy? Or are you looking to start from scratch? There are a few best practices for vendor management that will help business operations run smoothly.
Start With the Right VRM in Your SaaS Stack
A VRM application should be included in your SaaS stack from the get-go. When companies are evaluating their multiple SaaS subscriptions, overall and itemized spending should be available to inform better decision-making.
VRM should be an integral part of any SaaS purchase, especially when it comes to SaaS providers that offer functionality that is not native to your business.
Maintain High Levels of Transparency
Confidentiality is key, but if it’s possible to involve vendors in some form of open dialogue, then it’s a good idea to do so. This way, both sides can understand and agree to the terms and conditions of the relationship. It’s also important to maintain transparency so that both parties can understand where the provider is in terms of meeting your needs.
Aligned incentives go a long way on this front. Having seen billions of dollars of software negotiations at Quolum, we recognise the importance of being fair, transparent and honest to vendors.
Keep Communication Open
Communication is important in any relationship, but it’s especially crucial in a vendor relationship. When there are any issues or questions, it’s important to be able to communicate them openly and honestly. This way, both sides can work together to resolve any issues. VRM is all about having easy and instant communication with SaaS vendors as soon as something comes up.
The Quolum SaaS Concierge ensures that (a) all communication is streamlined; (b) all channels are kept open year round; and (c) all intelligence is recorded, ensuring you have a smooth renewal discussion as well.
Make Sure You’re Getting the Right Level of Support
Support is an important part of VRM. As you review and adjust your SaaS subscriptions, your VRM provider should be there for you to answer questions and resolve issues. The Quolum SaaS Concierge acts as your extended procurement and vendor management team, and having access to a dedicated account manager frees up time that your senior leaders may otherwise spend.
Create Vendor Scorecards With KPIs
You should conduct an evaluation of your SaaS vendors every year, or better, every month. This will allow you to track the progress of the relationship and make sure that you’re getting the best possible value for your money. You can also create vendor scorecards that measure specific areas of the relationship, especially your satisfaction with any services rendered by the vendor.
At the time of renewal, or even a new purchase, the software buying experts from Quolum will do just this, if the timelines and situation make it the right call. An alternative (and much more effective) solution is to the Quolum application integrations that will continuously and automatically monitor the usage of SaaS in your company. This way, data drives the decisions on the value that the product creates.
Learn More About Your Vendors
It’s so easy to manage business relationships from a distance these days thanks to technology. However, you need to make sure you’re getting to know your vendors on a more individual level if you want to build lasting and productive business relationships. This way, you can understand their motivations and how they think, and have more opportunities to get the best possible deals.
Reach out for one-on-one meetings and schedule regular check-ins. There should be an open line of communication, which could be anything from a chat on a secure messaging app to a specific phone line that both parties can be reached at easily.
Seasoned procurement teams like the ones at Quolum also have preferred or on-staff vendors and resellers for popular tools, and such relationships often result in credits, rebates and discounts.
When Vendor Relationship Management is Done Right: The Benefits
Manual management of vendor relationships is definitely a thing of the past. Today, each business should be using automated tools to ensure that they are doing vendor relationship management correctly. Quality automated VRM enabled by SaaS platforms like Quolum can have many benefits:
Having a complete overview of all your vendors in one place is an invaluable asset. This allows you to identify any potential issues as soon as they arise, and to resolve them as quickly as possible.
When you know exactly what you’re spending and where you’re spending it, you can better control your costs. This is especially important when it comes to SaaS, as there can be a lot of hidden costs.
The days of spending hours tracking down expenses and reviewing every one of your SaaS subscriptions are over. Your company’s executive team and finance department should not be wasting time on something like this, draining resources from your highest-value team members.
With an overview of the complete picture, and itemized data for each vendor, your finance department will have more time to focus on high-level decisions about the services instead of micromanaging costs.
A great example of this is the contract dashboard summary in Quolum. Senior leadership can save hours comning through lengthy contracts, to have all the relevant data they need at their fingertips.
Master Vendor Relationship Management With Quolum
SaaS management has never been easier than now thanks to Quolum’s suite of vendor relationship management solutions that include the Quolum SaaS Card. Now you can pay for all your SaaS subscriptions with your Quolum Visa Card which acts as your ultimate source of truth for your paid apps. The card is set to identify non-subscription service charges and block them for added security. When it comes time to negotiate your contracts, our dedicated experts can help you get the best price and maximize ROI.
Quolum’s all-in-one SaaS Management Platform is a native platform with usage racking across 100s of tools, and deep feature-level integrations from over 100 popular SaaS tools including Slack, Asana, Jira, Zoom, and more. This means that our platform will automatically track usage information and statistics on all the SaaS solutions your company uses and identify areas where you’re wasting money on unnecessary features and services. Ultimately, you can save up to 30% of your SaaS expenses just by using Quolum!
With Quolum’s dedicated SaaS concierge, you’ll never get left behind. Our experts will manage your SaaS for you, so you can focus on developing new business and expanding customer relationships.
Frequently Asked Questions About Vendor Relationship Management
What is vendor relationship management?
Vendor relationship management is a process that helps businesses build and manage relationships with the providers they choose to buy SaaS from. It ensures that the businesses are getting the best possible value for their money and that the providers are meeting their needs.
How is vendor relationship management different from customer relationship management?
Customer relationship management is a process that helps businesses build and manage relationships with their customers. It ensures that the businesses are meeting the needs of their customers and that the customers are happy with the service that they’re receiving. Vendor relationship management helps businesses manage relationships with multiple SaaS vendors, while optimising for cost and tracking overall SaaS spending.
What are some of the benefits of vendor relationship management?
The benefits of vendor relationship management include:
- Better awareness
- More rapid response to issues
- Cost control
- Increased efficiency
- Better coordination
- And more!.
Do SaaS providers always need to be in a VRM?
No, providers do not need to be in VRM in order for your company to sell SaaS. However, VRM is an important part of any SaaS purchase, and it’s a good idea to have a process in place to manage the relationships for your SaaS vendors.