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  • Writer's picturePacificCommercialPropertyServices

7 Tips on Effective Vendor Management for Property Managers

Updated: Apr 20, 2022

Tips for Commercial Property Management Companies on Effective Vendor Management and How Commercial Property Maintenance Contractors Can Help

Effective Vendor Management is crucial to the success of commercial real estate management and owners.

"Hiring a knowledgeable and professional commercial facility maintenance company or industrial property maintenance contractor can make a huge difference in successful vendor management and expediting workflow."

Tip #1 - Controlling Costs

  • Having strong relationships with your vendors can help you to negotiate better rates and have access to discounts and incentives that can increase your profit margin.

  • Effective procedures and processes are essential for successful vendor management and predicting costs.

Tip #2 - Reducing Vendor-Related Risks

  • Managing a commercial or industrial property requires multiple trades and areas of maintenance. When contracting out these facility or commercial maintenance services, it is best to make sure you hedge your risk with each supplier.

  • New commercial and industrial property maintenance vendors come with a lot of unknowns which can lead to potential risks that could disrupt or impact the company if not thoroughly vetted.

  • Vetting requires time and knowledge of industry standards, license, certification, insurance & bonding requirements, and past performance.

  • Companies should create backup plans in case vendors fail to deliver their services as agreed in their contract.

"Hiring a knowledgeable and professional commercial facility maintenance company or industrial property maintenance contractor can make a huge difference in successful vendor management and expediting workflow."

Tip #3 - On-Boarding Vendors

  • During the process of gathering information and documentation required to onboard the vendor as an approved supplier for your business, you must ensure that the vendor can be fully paid for any goods and services they provide.

  • The administrative burden of managing multiple vendor invoices, collecting all their payment information, insurance details, tax forms, and proof of the relevant licenses they hold can slow down employees or require a dedicated vendor administrative employee.

  • Consolidating these vendor management tasks such as bank details, capability information, regulatory data, and capabilities, the quicker you can onboard your vendors and start servicing your commercial or industrial property.

Tip #4 - SourcingVendors

  • To source vendors, you must research and pre-qualify them as suitable to supply for your company. Once this has been done a formal quote request process would start in order to receive pricing for the established scope of work.

  • Although the price is an important factor in the selection process, vendors should also be evaluated on their reputation, capacity, and ability to communicate efficiently.

Tip #5 - Establishing & Maintaining Scopes of Work and Logs

  • In order to properly manage your facility or property maintenance contractor, it will be required to establish a scope of work and maintain logs for work performance. This can be effective if the proper processes are in order and the property management staff assembling these items have technical knowledge of the services being provided.

  • Without a comprehensive log or scope of work established there can easily be issues with work performance, accurate service coverage, and inconsistent work quality.

  • Effective vendor management requires the technical and industry knowledge to establish a detailed scope of work and maintain/track work logs for all property maintenance services performed.

Tip #6 - Negotiating Contracts

  • Ideally, contracts would be finalized towards the start of the vendor management process. They must be fine-tuned to benefit both parties. Contract negotiations can be time-consuming. The process must define the start and end of the arrangement, terms, and conditions, and the goods and services that the deal will include.

Tip #7 -Payment

  • Finally, the payment process involves making sure that all vendors are paid on time for all goods and services rendered as outlined in the agreed terms of your contract.

  • When multiple vendors are involved this means an invoice would be received for every service performed. Consolidating as many administrative responsibilities as possible is key to successful vendor management.

When vendor management is such an important part of a company’s success but is a non-core function of the company, outsourcing can save time and money, leaving property managers and owners time to spend on the core functions and service offerings required to make the company run. See how consolidating these services into a "One-Call Solution" can save you time and save you money.


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