Working with vendors and consultants

Heather Carpenter | August 1, 2008

Researcher and consultant Heather Carpenter offers tips for working with vendors, consultants and contractors.

There are many vendors, consultants and contractors that work with organizations on a daily basis or as special needs arise. They range from copy machine vendors, phone/wiring vendors, to accountants, web designers and more.

Here are some steps to follow when working with vendors.

• When researching vendors, get multiple quotes to make a comparison of prices and services. Many organizations put together a request for services proposal also known as a Request for Proposals (RFP). Contents of an RFP vary depending on the project, however an RFP should always include information about the organizational needs and the timeline for the project.

• It is good to verify that prospective vendors have many nonprofit clients and that those clients are happy with their work.

• Never make a decision about purchasing something for the organization over the phone - always request something in writing. If the vendor can't give you something in writing then don't purchase it.

• Always put consulting agreements in place before having the vendor engage in a project. The consulting agreement should include a clear scope of work, deliverables, timeframe, fee schedule and a statement that says the consultant is not an employee of the organization.

• Carefully review all invoices received from vendors and verify that the information is correct.If a vendor overcharges you, dispute the charges and don't give up until they are resolved. Being persistent and following up with the vendor on a consistent basis works.

• Stay in the habit of providing prompt payment to vendors. This is good financial management, and when a new vendor asks for a reference, you can easily call upon your current vendors who have received prompt payments from you.

On another note, nonprofits must not operate for anyone's private benefit. They risk their exempt status if they hire a friend or relative to do a service for the organization without following their conflict-of-interest policy. Check with your attorney for more information about conflict-of-interest policies.

Heather Carpenter is Viterbi Family Doctoral Fellow at the Caster Family Center for Nonprofit Research at the University of San Diego. She has seven years of prior experience as a nonprofit manager and consultant.

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