How To Ensure Your Suppliers Are Compliant

It is the responsibility of every company to adhere to laws and regulations. Compliance varies based on the country, the industry and the size of the company, with some industries such as banking being more heavily regulated than others. Data Protection Act 2018 is an example of a law that every company must comply with.

For a company to become compliant, and equally important, remain compliant, they must put in time, effort, and money so that they can conduct business as usual. Not complying and breaking these laws and regulations can result in fines, the closure of the company, and even imprisonment for the directors of the company.

In addition to complying with laws and regulations, companies can follow policies and guidelines as well. They are important because they demonstrate that a minimum standard has been attained, even if they are not mandatory. A good example is ISO standards, which are internationally recognized minimum standards in a particular area. They are designed to boost confidence and trust in the company that has them. A good example is ISO 14001, the Environmental Management Certificate which is becoming increasingly sought after in suppliers.

Working with compliant suppliers

The companies invest time and money in becoming compliant themselves and they want their suppliers to be compliant as well. Increasingly, companies must prove compliance to win new business and continue working with clients. Working with non-compliant suppliers sometimes may inadvertently put a company at unnecessary risk, through no reason of its own.

Supplier on-boarding

When engaging with any new supplier its important to ensure that they provide all the required proof of compliance up front. What exactly is required will vary from company to company. Every supplier will be want to start the relationship positively and to be compliant.

So it’s important that businesses work with suppliers who maintain their compliance. A common mistake is obtaining proof of compliance at the beginning of a contract and not checking that this documentation is renewed when it expires. Usually, the supplier will be compliant, but there is a risk that they won’t be.

Supplier Management software

The solution to this problem is to use a Supplier Management software, as it provides an easily accessible repository of supplier documentation that proves compliance. Additionally, it will alert users when documentation is about to expire and needs to be renewed, as well as allow them to check and approve the documents.


Companies with more resources, especially those who have a larger workforce, find it easier to create processes and monitor supplier compliance. For SMEs with fewer resources, a simple and intuitive Supplier Management solution such as oboloo can easily track supplier compliance. oboloo is a self-service system that enables companies to be supplier smart through sourcing, contract, supplier and savings management. For more information, please visit www.oboloo.com.

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You can use the following external articles to get a better understanding of points to consider when creating or improving your supplier management process:

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