The Ultimate Supplier Checklist for Logistics Companies

Every supplier and every company is unique in its way of working. Different processes and teams require different requirements, and the way logistics companies maintain a successful relationship with their suppliers varies. One thing that remains constant regardless of the supplier is the need for a comprehensive and positive onboarding process for suppliers.

By: Uwe Stroh

(Frankfurt/Main) One way to ensure consistency in the onboarding process is to create a general checklist. While each specific experience may require some adjustments, this basic guideline helps ensure that companies follow best practices and start suppliers off on the right foot.

Step 1: Evaluation

For a relationship to be successful, both parties must thoroughly evaluate each other. Knowing the supplier’s track record, financial development, and compliance with regulations helps logistics companies determine whether a partnership would be beneficial. They want to ensure that their business partner is reliable and can meet specific requirements. When companies begin evaluating suppliers, they should check:

• Supplier’s track record
• Sustainability credentials and their relevance
• Creditworthiness and financial data
• Compliance with relevant industry regulations and regional laws

Additionally, companies should create a code of ethics that is mandatorily signed by the supplier.

Step 2: Requirements and Approvals

The evaluation shows that a partnership would be advantageous. Now it is time to negotiate the specific requirements. At this stage, companies and suppliers must communicate transparently about their expectations. This direct communication helps manage expectations and hold the process accountable. All parties need a clear understanding of each member’s responsibilities. Companies should establish all chains of command for approvals or necessary contact points. Onboarding checklist:

• Scope of requirements
• All lead time schedules
• Ordering processes and requirements
• Pricing matrix
• Payment or credit terms
• Delivery standards
• Required training

The list contains general information. Specific industries may require additional requirements and approvals. Likewise, the specific onboarding checklist may look different or contain unique requirements.

In some situations, suppliers may need a more intensive requirements and approvals process. For these higher-value or strategic suppliers, companies should include additional points in their checklist. If the list is very detailed and extensive, it makes sense to appoint a representative to guide the supplier through the process.

Step 3: Collecting Supplier Data and Information

An online portal provides the reliability and efficiency for a swift onboarding process. Suppliers can enter their data here and expedite the onboarding process. Both parties have access to the data at any time. This creates transparency and trust and improves overall organization. The following information should be at a minimum:

• Name, email, and individual contact details
• All required license documents
• All additional supplier contacts and their titles

Clarifying Access to Supplier Information

Everyone involved in the process should have access to supplier information and know the compliance policies as well as points of contact. This includes, among others:

• Account managers
• Procurement staff
• Warehouse managers
• All relevant departments

Unless the supplier information is highly sensitive or the supplier in question is a strategic partner, it is advisable to communicate all information transparently. For a successful delivery process, companies should ensure that they provide the necessary training and answer any open questions.

Tip: FAQ Document

Incorporate the most frequently asked questions into an FAQ document to use for future training and review initial guidelines at regular intervals.

The onboarding process is the first step into a new partnership with a supplier. It is important for both parties to create a positive experience. Strong partnerships begin with clear expectations and honest communication. With the help of the checklist, logistics companies can ensure that they proceed thoroughly in onboarding their suppliers.

Checklist for Supplier Onboarding (in English): https://hub.tradeshift.com/supplier-management/supplier-onboarding-checklist

Uwe Stroh, Dipl.-Ing. FH, Director Sales DACH and Eastern Europe at Tradeshift. Leadership experience in various industries (including Telecom and IT).

Tradeshift publishes the “Index of Global Trade Health” quarterly. The current index for the 2nd quarter of 2021 has just been released:

 
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