Your supplier relationships are an important aspect to your business growth. “Why is that?” you may ask, “they simply give me what I ask for, they know us and we have a good relationship”.
Creating a “Virtuous Circle” as part of your Business Growth Strategy will help you to maintain good supplier relationships and get great ‘added value’ rather than just a ‘cost’ to your business?
As a growth principle, your entire business should address how it looks at all aspects, from employee contribution to customer support. If your business has a coherent belief and delivery strategy, inclusive of every employee, all will have an understanding that they ‘add value’ by working in an aligned and effective manner. You in turn give your customer added support leading to a longer term stable business relationship.
Turn your suppliers into ‘value adding partners’
We suggest you look at what you expect from each supplier carefully. There are likely to be hidden opportunities which are so often overlooked. Here are a few starting point questions to ask yourselves on a regular basis as you grow your professional supplier relationships:
- Innovation – they are experts in their field, never overlook an opportunity for added value from a supplier who has potential to easily offer you a solution to your development product or strategy.
- Respect- this is demonstrated by the approach and commitment to your needs. A supplier who is working with you will offer advice based on what you need not what you need to hear.
- Delivery – suppliers who exceed your expectation, without a push from you, are worth developing as a ‘partner’ for relevant projects.
- Limitations - very much linked to innovation; if your supplier is not growing and improving their offer to you - you are not obtaining ongoing value.
- Integrity – make sure you both have the same values.
Who are your best suppliers?
The best suppliers will regularly give you new ideas and suggestions to improve your business. There is much to be gained by having a stable / long term supply base as long as they assist you to grow by improving aspects of the business. The stability and support of your suppliers is essential when you are growing or your business is seeing changes in its market.
What should a business look for as triggers for change?
The following simple points will help you to discover if your costs are just that and adding no benefit (value).
- Suppliers never offer uninitiated change – “great guys and they know us well”.
- No available time as the team is just too busy with the day job.
- Too much trouble - 101 reasons not to change as a business culture “by doing the same things you will only obtain the same results”
- Annual increases should mean annual performance review
- Your cost ratio to sales revenue is at best ‘a constant’ – you should be targeting an overall reduction in costs as your efficiency / opportunities increase.
The consequences of doing nothing:
- You are not obtaining any return on (your considerable and long term) investment (ROI)
- You are suffering from ‘customer dissatisfaction’ often without realising.
- Your organisation needs to re energised.
- Don’t forget to involve and challenge your suppliers to bring you improvement as part of the project delivery.
- Don’t buy on price alone - always consider overall benefits to give maximum value
- Be suspicious of the status quo – staying still isn’t an option!
- Reward proactive suppliers, they are a great asset to your business!
- Seek replacement suppliers where costs only increase – you’ll never know what you are missing.
- Use your financial reporting objectively – it belongs to all and should be your official version of truth.
- Ensure you align your approach to suppliers to your approach to customers - any differences will have a negative effect on your business.
So how do we help?
We help to change perceptions by assisting with improved working methods. We work to ‘align functions’ and increase your business ability and profitability.
…and most of all we are Independent Growth Consultants, on your side!
Contact us for a no obligation chat or to find out more gives us a call we’d love to hear from you