Here are some methods on how to reduce them down and make them manageable.

The main reason for having a big list of suppliers is because for every invoice you receive, you set up a suppliers account for it. But you don't need to do that. Here are suggestions on how to deal with these one off suppliers.

Set up a Cash Purchase Supplier Account.

For all those one off purchases, put their invoices into this account. Now you have one account that deals with a multitude of suppliers. And because in most cases you pay immediately with a cheque or cash, you don't have to worry about forgetting to pay the account. Examples are car repairs, electricians, and purchases in local shops.

Accounts you deal with regularly, but are not given a credit account.

Do set up an account for these type of suppliers, as this will allow you to see how much you transact with them and in the future be in a position to argue for a credit account with them, as you can show you are a good payer and the business is growing with them.

Accounts you deal with once or twice a year but every year.

The county council is an example of a supplier you deal with once or twice a year but every year. Do set up an account for them as it makes it easier to administer and allow you to check when and how much you paid them. If you pay motor tax to the county council keep this in a separate suppliers account from the building rates and water rates you pay to the county council.

Accounts you have not dealt with in a long time and are unlikely to deal with again.

This can happen when you find a better supplier or where a supplier has gone out of business. Delete suppliers you are not going to use or have not dealt with in a long time and look out for duplicate supplier accounts i.e. accounts set up more than once.

Summary:

• Don't set up a supplier account for every new supplier, unless you are going to deal with them regularly.
• Set up a cash purchase account to handle one off purchases 
• Set up supplier accounts for suppliers you deal with regularly but get no credit from. 
• Delete old and duplicate supplier accounts

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(c) Nilsson Denver Ltd 2007