Assuming your kernel and computer's hardware does support suspend/hibernate, you can see what xfce4-power-manager is trying to do by starting it in debug mode. To do that first, stop the current running instance of xfce4-power-manager:
xfce4-power-manager -q
Then run it in debug mode:
xfce4-power-manager --no-daemon --debug
You'll then be able to see messages like:
Which means xfce4-power-manager is trying to use systemd-logind, but your system or distribution's policy is preventing it (authorized=FALSE).
These messages indicate that xfce4-power-manager is trying to use upower, but again is blocked by system/distribution policies.
Here, xfce4-power-manager is using ConsoleKit2 and is blocked by system/distribution policy.
Finally, if none of those other tools are detected then xfce4-power-manager falls back to an internal method to perform these actions. It will use an org.xfce.power.xfce4-pm-helper policy file to determine if it's authorized to perform those system actions. For the internal fallback (and ConsoleKit2) you'll need to ensure you have the pm-utils package installed if you're using Linux. FreeBSD, OpenBSD, and DragonFlyBSD based systems will just work.
To have logind handle the lid open/close event:
xfconf-query -c xfce4-power-manager -p /xfce4-power-manager/logind-handle-lid-switch -n -t bool -s true
To have logind handle the power key:
xfconf-query -c xfce4-power-manager -p /xfce4-power-manager/logind-handle-power-key -n -t bool -s true
To have logind handle the suspend key:
xfconf-query -c xfce4-power-manager -p /xfce4-power-manager/logind-handle-suspend-key -n -t bool -s true
To have logind handle the hibernate key:
xfconf-query -c xfce4-power-manager -p /xfce4-power-manager/logind-handle-hibernate-key -n -t bool -s true