6 Of The Best Ways to Win a Stronger Supplier Relationship
A quick guide to winning a better relationship with your supplier.
1. Find the right supplier
Finding the right supplier might be the most time consuming of the entire process. But when it’s done right, you’ll never have to worry about it again — especially once you follow steps 2–6 to winning the strongest possible supplier relationship.
There are many outlets to finding the right supplier for your store. Here are a few you can take advantage of:
- Industry Events: Make an effort to attend various expos and buying shows specific to your industry. Suppliers are there to network and meet clients, so these are always a great place to discover your options.
- Trade Publications: Flipping through magazines might sound old-school, but suppliers are still putting out content and ads on industry-specific magazine publications.
- Industry Associations: Almost every industry has an association for retailers, suppliers and wholesalers to connect and network. Usually, you don’t have to be a member to review their supplier directories.
- Online Directories: Nowadays, you can find several free online directories of suppliers. Sort through and get in touch with them to see if they’d be a good fit.
- The Competition: Another way to discover new suppliers is to ask current suppliers about their competitors. You might find their competitor to be a better fit for your needs.
2. Carefully make agreements
When you sign on with a supplier, there will be a series of agreements. Carefully approach this process, keeping in mind that these terms will be the basis of your supplier relationship. This is an important time for negotiation of contracts. Here are a few ways to win with supplier agreements:
- Know the supply conditions: Ask about volume, price, discounts, ordering periods and delivery times.
- How to handle when things go wrong: Discuss the supplier’s warranties and policies for defective goods.
- Ask a lot of open ended questions: The who, what, where, when, and why’s.
3. Stay in constant communication
Continually strengthen and build on supplier relationships. Even when you don’t need anything, asking about your supplier’s current state of business, upcoming plans, and product launches will pay off in many ways.
These types of conversations are relaxed and friendly, rather than strictly professional. Your supplier will be more inclined to share information with you, keeping you in the know and ahead of the curve.
If your business is doing well, your supplier is doing well. It’s a win-win, so take advantage of the opportunity to build on that relationship.
4. Collect and share sales data with suppliers
By sharing your sales data, your supplier will be able to forecast demand and keep orders on point. This data is helpful for both you and your supplier, as you will maintain the necessary inventory and they will know when to expect bulk orders and discontinued items.
If your point of sale system calculates this data for you, it will be a simple click of a button to send monthly sales reports and weekly inventory updates. This helps both you and your supplier to identify weak spots, opportunities and risks.
Upgrading your point of sale technology can further simplify the purchase order process. A point of sale with robust inventory management lets you view all your suppliers in one place, and get notified when you need to make a purchase order.
5. Provide honest and constant feedback
If something goes wrong, reach out immediately to explain the situation to your supplier. Smooth communication is important. You can provide specific details and photos of an incorrect delivery or defective goods. This type of response will help your supplier resolve the issue quickly.
6. Be a good customer
It’s pretty simple. Pay on time, be polite and friendly, and follow their requests. E.g. If your supplier asks for orders to be placed on a pre-formatted spreadsheet, then do it.
Becoming a trusted and respected customer is mutually beneficial. The more loyal you are, the more demanding you can be. Developing a strong supplier relationship can take your business to a whole new level.
“Honda is a demanding customer, but they’re loyal to us. [Toyota] has us work on drawings, asks other suppliers to bid on them, and gives the job to the lowest bidder. Honda never does that.”
– CEO, industrial fasteners supplier to Honda
Honda believes they can create the foundation of a strong relationship, only if they know as much about their supplier as the supplier knows about themselves.