A vendor management solution refers to the methodical strategy that companies employ to oversee their vendors or suppliers. It involves a series of methodical procedures like contract negotiations, risk management, cost control, vendor selection, and service delivery assurance. Vendor management services aim to reduce risks and maximize expenses related to vendor relationships by identifying and assessing possible vendors according to pre-established standards.

Vendor selection is a crucial aspect of vendor management, whereby companies identify and assess possible providers according to predefined standards. Other crucial components of vendor management are cost containment and vendor-related risk reduction. Companies want to maximize their spending while lowering the risks connected to their vendor agreements.