Building Winning Partnerships with Your Vendors
As a business owner, I know you think about more than the revenue you generate. You also consider the costs your decisions will incur and the resulting margin you retain.
Have you ever considered that the vendors you work with also have these concerns? If you want to build winning vendor relationships, it pays to communicate a strong message that you want to partner with your vendors. The message should be, “I want to help you grow and build a successful business as I grow mine.”
You want your clients to see you as a value creator, don’t you? Consider the exponential value to you as a business if your vendors saw you in that light as well.
Focus on Being a Good Fit.
Creating a vision of the potential within each partnership begins with making sure you’re as good a fit for your vendor as they are for you. Recognize the value of your vendor’s time, especially when they are offering a service. Do your research so you have as lucid an understanding as possible of what your needs are. Then voice them clearly so your vendors know whether working with you will grow and build their businesses.
Also, take some time to get to know what your vendor’s needs are. What motivates their investment into their business? As you do this, you’ll identify partners who share complimentary philosophies in how they do business. This alignment compliments your partnering fit.
Exchange Knowledge with Your Vendors.
Change Factory, an Australian change management company, says it well. “Vendors hold a wealth of knowledge relating to their products or services. A vendor also holds knowledge on utilization within industry. That knowledge helps you, as a client, achieve your objectives.” 1
Renate Cunneen suggests in her Huffington Post blog that “the biggest mistake clients make when dealing with outsourced vendors” is to bring vendors on board, and then to “not listen to them when they try to give us clear feedback on our own shop[.] Part of growth in human beings and in business is listening to what you may be missing in yourself that someone else can see from the outside. Growth is hearing what we don’t really want to hear, accepting it, facing it and making the real attempts [sic] to change it. Maybe there are cracks in your own business that the vendor can clearly see from the outside; why wouldn’t you want this type of feedback? Above all, how many vendors will give you this feedback? Many won’t if there is not a level of trust where they feel comfortable enough to share candid feedback. That in itself is a tragedy.” 2
Treat Them as Valued Partners.
You’ll build few winning partnerships if you constantly ask, “What’s the bottom price you can offer me?” Your message delivers as, “I only care about the value you create for me.” Instead, focus on the value the partnership creates for both of you.
Louis Grasmick, founder of Louis J. Grasmick Lumber Co., tells the story of a supplier stuck with two boxcars of lumber in transit from the west coast to the eastern seaboard. Their customer had canceled mid-country. While the company still lost money on the deal, Grasmick’s willingness to take the loads and sell them at no cost to the supplier became a winning deal for his business. Because Grasmick put himself in the supplier’s position and did what he could to reduce the impact of the canceled order, it led to many profitable arrangements for both Grasmick Lumber and the supplier in the future.
Did Grasmick know this would help his business? No. However, his business embraces two attitudes. 1) “We wouldn’t expect anyone to suffer because of us.” 2) “It’s also important to do the right thing.” As a result, he believes their company benefits from advantageous pricing their suppliers don’t offer to competitors. 3
Don’t slip into the assumption that once you’ve chosen a vendor your contribution to the partnership is completed. Your vender may know exactly what needs to be done; however you need ongoing communication to work out the specifics for a winning relationship with your company. Recognize that when a vendor seeks more information they aren’t shifting the work back on you. They’re doing what’s necessary to provide the service or quality of materials you hired them to deliver.
When a vendor relationship begins, it’s easy to focus on what the vendor is going to do for you—expectations, etc. However, if the ongoing connection is only about you, partnerships will fail to form. Without the sense you have a vested interest in their success, most vendors just do the expected. Nothing motivates them to look for exceptional ways to help your business.
Become a value creator. Becoming a successful partner begins with you.