It is an important step in the supply chain, as businesses are vulnerable to a host of potential threats that can emerge from their relationship with suppliers, according to Rudi Kruger, general manager of LexisNexis Data Services. Unscrupulous business practices pose great risk and, if left undetected, they could have severe consequences on the business as a whole. Some of the more prominent threats include:
The potential of reputational damage, legal non-compliance and potential financial losses due to supplier transgressions are too risky.
However, with the right information obtained via in-depth vetting, procurement professionals can arm themselves with everything they need to make informed decisions and subsequently, protect the business. In-depth vetting sounds like a tedious task but there is help.
“Third-party providers of vetting tools have strong databases on verified content, making them reliable and efficient,” said Kruger. “Making use of them greatly benefits the supplier vetting process time and time again.”
It is also useful in ensuring compliance with the Public Finance Management Act, Municipal Finance Management Act and King IV.