Your approach to suppliers needs to be part of your strategic plan since almost every company, whether productor service-oriented, is dependent on suppliers. You need good and reliable suppliers. When you find them, treat them like gold. Suppliers are essential to your business’s good health and growth.
Let’s briefly look at all the ways suppliers can impact your company.
- Quality. Supplier components can positively or negatively affect the quality of your product. Higher quality increases customer satisfaction and decreases returns.
- Timeliness. Their timely deliveries are crucial to how customers view your reliability.
- Competitiveness. They can give you the one-up on your competition based on their pricing, quality, reliability, technological breakthroughs and knowledge of industry trends.
- Innovation. Suppliers can make major contributions to your new product developments.
- Finance. If you’ve proven to be a considerate, loyal and paying customer, you may be able to tap into your suppliers for additional financing once you hit growth mode – or if you run into a cash crunch.
Having said how valuable and important a supplier can be to you, I’ll now say that you should not be a patsy. You can be a demanding customer – just be fair. State your quality and time needs clearly. Hold your suppliers to their agreements. Make sure they stay competitive. Tell them you never expect to pay higher prices than other purchasers.
Be a Valued Customer
In order to be a valued customer to your suppliers, here are a few things you should do:
- Always pay on time. Once the order is placed, don’t renege on the deal or attempt to change the rules. If you can’t pay, call up your suppliers and tell them why and when you will pay. Don’t play games with suppliers’ cash. You’ll be amazed at the goodwill and benefits you will earn by observing this simple rule.
- Provide adequate lead times. Try to give suppliers as much lead time as possible on your orders. It helps to be knowledgeable about your suppliers’ production methods and needs.
- Personalise the relationship. Visit suppliers’ offices. While you’re at it, include them in some of your strategy meetings and even office parties.
- Share information. Keep suppliers aware of what’s going on in your company. Tell them about changes in key personnel and new products. Many times, you’ll find that good suppliers can help you find new customers.