TYPES OF REWARDS
• Financial incentives: performance bonuses, gainsharing and preferential payments terms.
• Business growth incentives: contract exentions, preferred supplier status and long-term offtake agreements.
• Recognition incentives: supplier of the year awards, executive endorsements, and early R & D. for customers they trust and who treat them as partners. A preferredpartner status, backed by tangible rewards, signals that creativity is valued.
• Third, costs fall more sustainably. Gainsharing models give suppliers a direct financial reason to think creatively about costs, turning them into active participants in a company’ s savings agenda.
• Second, resilience improves. When materials or capacity become scarce, suppliers make choices about who to prioritise. Buyers who have built goodwill are far more likely to be looked after in a crunch.
Incentive programmes represent a less transactional and more collaborative relationship. When both parties benefit from outstanding performance, the relationship moves from contract management to genuine partnership, creating long-term value.
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