Could your business only be as good as its suppliers? To a large extent, the businesses you choose to supply you with goods and services are extremely important to your customer-facing image. They get the full package, and when your suppliers don’t deliver as expected, it’s your business that gets the blow to its reputation. There are many advantages to finding trustworthy suppliers and building strong relationships. Here are a few of them.
Your Business Keeps its Promises
Whether it’s the date when your reliable couriers deliver the goods or the quality of the goods themselves, having the right suppliers makes it possible for you to meet customer expectations. On the flipside, blaming suppliers for failing to deliver on your promises isn’t going to earn you much sympathy from disappointed clients. It’s not unfair. After all, it was you that made the promises in the first place, and a failure on the part of your suppliers doesn’t give you a valid excuse for failing your customers.
You Have Better Bargaining Power
Businesses like to keep their customers, and your suppliers are no different. When you’re a customer in good standing who brings them a substantial amount of business, you have a little leverage when you need to negotiate. Switching suppliers puts you back at square one in the relationship so developing your status as a long-standing customer makes excellent sense. You may be able to negotiate preferential treatment when you do, and that can come in handy when the chips are down.
You Can Plan Together and Optimise Efficiency
Planning your business year together with your suppliers helps you (and them) to work more efficiently. If you can give fairly accurate predictions of your needs, they can work to meet them instead of being taken by surprise by rush orders. Retailers can plan promotions in advance, manufacturing businesses can reserve necessary inputs in advance of their peak demand season, and so on. You can even team up on the marketing front, benefiting each other while boosting sales.
Budgeting for your business can be a headache – and if you don’t know what to expect from input costs, it’s much more difficult to budget accurately. With strong supplier relationships in place, you can enter into pricing agreements that keep costs stable, or at the very least, know whether price increases are on the cards. Your suppliers will also enjoy advantages since they can use your information to help them estimate turnover, so it’s a win-win situation.
Save Time and Resources in The Purchasing Process
Having to hunt through an extensive database of suppliers, check availability, get quotes and ultimately get approval for orders can take a lot of time and resources. If your team already knows who to approach for important inputs, it becomes a simple matter of following routine. And since the strategic decision on who suppliers are is already finalised, you can even delegate final approvals to the relevant line managers instead of having to run every order past top management.
Choose Wisely and Share the Benefits
Choosing suppliers or switching suppliers is a big decision that has far-reaching implications for your business. Although price is certainly a consideration, reliability, a willingness to work in concert with your business, and a commitment to a longer-term relationship are valuable assets in any supplier relationship. Ultimately, your supplier choices will impact your business’s reputation as well as its profits. The value of strong supplier relationships cannot be overstated. Choose wisely!