4 Exit Strategies for Offboarding a Vendor
Do you have an exit strategy if a vendor relationship sours?
Having an exit strategy in case your vendor relationship must come to an end is crucial. When faced with offboarding a vendor, you'll want to avoid any surprises. Learn 4 exit strategies in this informational podcast.
Hi – this is John Daughtery with Venminder.
In this 90-second podcast, you’re going to learn about 4 common exit strategies that are used when offboarding a vendor.
Here at Venminder, we have a team of industry experts who understand the complexities of the entire third-party risk management lifecycle – from onboarding to offboarding.
When you’re in the process of selecting a vendor, you may not think about what to do if you need to terminate the contract. However, it’s critical to have an exit strategy before making the business relationship official. When faced with offboarding a vendor, you’ll want to avoid any surprises.
Here are four possible exit strategies you can use:
- The first option is replacing the vendor. This method requires careful planning to ensure that you have enough time to negotiate and execute a new contract.
- The second strategy is to bring the outsourced activity in-house. This might be an ideal solution if your organization already has the necessary resources and skills to handle the work.
- Another option is to terminate the activity. If you choose this strategy, you’ll want to be aware of any impact this will have on your operations or customers. You should also consider any financial impacts of discontinuing the activity.
- The final option could be some combination of the three previous methods. For example, maybe your organization could absorb a portion of the service while replacing the remainder of it with a new vendor. Whichever combination is used, you must identify and understand the impacts on the business area absorbing the work to ensure your solution is achievable.
Regardless of the strategy you use, you’ll want a well-documented plan that lists the tasks, responsibilities, timing and communications necessary to ensure that the offboarding process is smooth for both parties. And, as a best practice, have the termination strategy formally reviewed and tested when possible.
Hope you found this podcast insightful. Thank you for tuning in and catch you next time!
Subscribe to our Third Party Thursday Newsletter
Receive weekly third-party risk management news, resources, and more to your inbox.