Like in all relationships, knowing who you are getting involved with is very important. For all you know, he or she may have a dark scary past that resurfaces one evening, which results in you sprinting through night, screaming, in nothing but your skivvies, while wielding a baseball bat.
Another type of relationship is with your vendors. Making sure your vendor is top of the line is the first step in your blossoming relationship that cannot be overlooked. In these rapports, mystery loses its allure. According to a Buildings magazine article, Vet Your Vendors: Screening Steps to Ensure Your Vendor Is Top Notch, “more than 80 percent of companies conduct formal background checks on their full-time employees, but less than 20 percent do any type of screening of their vendors, supplies, and contractors.”
Why the risk? Ask yourself, is your company certain you know the vendors with whom you conduct business? If you aren’t checking on the backgrounds of your vendors, you run the possibility of not being fully aware of your risks when conducting business with them.
The article also underlines the importance of having compliant certificates of insurance (COIs):
“One of the most time-consuming and daunting tasks every business, especially property management firms, must contend with is correctly assessing and managing certificates of insurance. In many cases, only after an incident occurs or a company’s auditor arrives, does a company become aware of the fact that the COI is either missing, expired, fraudulent and/or non-compliant.”
I promise, the effort it will take to come back from an incident like that is far greater than the effort needed to prevent it from ever happening. Save yourself the stress and vet your vendors beforehand. With more and more global vendors that work their way through organizations today, the need for augmented due diligence and compliance management is vital to risk management.
Don’t end up in the doghouse because you overlooked a shady new vendor. Besides, we think the vet sounds better than the pound anyway…