Giving a compliment to a supplier when it is warranted does not encourage a supplier to lessen performance. On the contrary, if done properly, it may produce a continuation of good results or even stimulate better performance.

It is proper to tell a supplier when errors have been made or when actions are less than expected. But some buyers may be inclined to only criticize poor performance. The problem with this approach is that suppliers can become insensitive to such fault finding. They may then pay little attention to serious problems and deficiencies.

Of course any compliments must be sincere and based on any benefits actually received. The amount of praise needs to be in proportion to the results obtained. For example, suppose a product is required in two days that would normally take two weeks to deliver. If a supplier salesperson or representative goes beyond what is reasonably expected to satisfy this critical need, then a thank you or other spoken statement of gratitude is appropriate, a written letter of appreciation may even be better.

Don’t always take the opportunity of adding criticisms when giving praise. The criticisms are best left when reporting a particular failure or for a negotiation where you can itemize both the suppliers good efforts as well as the failures; hopefully by quoting statistics that have been obtained from recorded instances of each.

The amount and frequency of the praise should be based on the length of time doing business with the supplier, the total experience with the supplier, and the particular relationship with the supplier. For example, suppliers who have performed consistently well for years may not need much praise, whereas those who have had problems may need a little encouragement when they deliver products in an exceptional fashion.