Vendors are the businesses a company buys materials, parts and services from.
Price is not the only term
Two suppliers at the same price are not equivalent. Availability, delivery, return policy, and payment terms all carry real value.
A supplier a few per cent more expensive but offering thirty days rather than payment on collection may be the cheaper option once the effect on working capital is counted.
Concentration
Buying everything from one supplier earns better pricing and creates a dependency. If they raise prices, run short, or stop trading, there is no alternative already in place.
This is the same risk as customer concentration on the other side of the business.
Terms improve with history
Payment terms are usually negotiable after a period of reliable payment, and rarely offered before it. This is one of the returns on business credit and on paying bills consistently rather than at the last possible moment.
Purchase orders
Ordering against a purchase order rather than informally is what makes an invoice checkable. Without one, a supplier invoice is difficult to dispute and easy to overpay — see duplicate payments.
Reviewing
Supplier pricing drifts. An account opened years ago on negotiated rates is frequently no longer on them, and a periodic comparison against current market pricing is the only way that surfaces.