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R-E-S-P-E-C-T...Entrepreneurs, Your Vendor Is A Business Owner Too! Make Him A Partner Instead of Just A Supplier.

Small-business-blog-respectI had a small business client whose relationship with a key vendor was, at best, rocky. The client was one of the vendor's largest and most visible customers. Yet, response time to specific requirements, problems or issues, while never all that good seemed to actually be getting worse. It seemed somehow counterintuitive that the vendor would be reacting this way, so I set up a time to meet with him without the client.

What I found was a situation that probably exists for many small businesses in some of their key vendor relationships. The vendor, who had known the owner for many years, just simply got tired of never being able to do enough to please the customer. No matter what hoops he jumped through, unrealistic delivery deadlines made or how many times he "went the extra mile," he simply could never gain his customer's satisfaction. Worse, it appeared that while the customer, whose business was thriving, in part because of the products and services provided by the vendor, begrudged anything "extra" he had to pay for services rendered over and above the standard products and services. So, the vendor, feeling hugely disrespected, just kind of gave up. "He just doesn't understand that I'm running a business too. That I have payroll and rent payments to meet and that I'm allowed to make a profit as well."

And this vendor is not alone. Many small businesses, so laser-focused on their own business success, fail to realize the fundamental importance of developing a partnership with their key suppliers, especially those who are small businesses as well. Here lies a significant opportunity for businesses to help each other succeed by forging a relationship built on trust and respect for what each is doing and bringing to the party for the other's success. I've talked a great deal in these posts about customer service, that is, vendor to customer. But there's another viewpoint. Vendor respect, that is, treating your supplier as a peer entrepreneur, understanding that they have other customers besides you, and like you, have goals and aspirations and need to grow their business and make a profit to do so.

Taking all this into consideration, if you have a key supplier, who provides you a product or service that is fundamental to the operation of your business or the delivery of your products or services, they are more than simply a supplier. They are a critical part of your business. Think about treating them like a peer, like a partner. Respect their business and they will respect yours. Help them understand how important their product or service is to your business. If you don't know, learn where you fit in their customer scheme (largest, smallest, somewhere in between) and how many other customers he/she is serving. Show them what happens when one of their deliveries is late. Have them explain the fundamentals of how they deliver their product and any role your company might play in impacting delivery schedules (like constantly wanting to change features or expedite product schedule). Show them how you drive revenue and the impact of what happens when their product malfunctions. Have them explain what's critical to their own revenue generation and how certain demands impact that. And above all, thank them for supporting you.

At the end of the day, you're both striving for the same thing. You both need each other. Respect your vendor's need to make a profit on what he/she delivers to you, either as a basic product or service, or a highly customized one. You'll be surprised how much the relationship will change and how much their response time to specific requirements, problems or issues improves and how much more proactive they become with you and your business.

"The Entrepreneur's Yoda knows these things. He's been there. May success be with you!


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