It is often tempting for companies to choose the lowest cost service provider.. However, this reflex is rarely the most interesting in the long term. Demonstration by Jean-Michel Laidin, partner Walter France.
Buying power is the ability of a company to order a certain volume of purchases regularly from its suppliers.. This capacity must be harnessed to build strong and lasting relationships. Indeed, what happens most often ? The company has a panel of suppliers and, sometimes with each order, consults them then concludes the deal with the one who offers the lowest price. This practice, common and easy, not really the best way to be productive. For the business manager, there are only advantages to establishing a privileged relationship with a controlled number of suppliers or trusted service providers, rather than multiplying contacts. Of course, beforehand, he will have to ensure that they are structurally sound and that their financial situation is healthy. Once these precautions have been taken, the manager will be able to appreciate the advantages of this type of relationship.
The costs, of certain materials (for the construction sector in particular) or certain foodstuffs, can be fluctuating. As soon as the company needs certain volumes over time, what she represents as a customer in the eyes of a supplier must be valued. Supplier side, it will be secure since it will be guaranteed a certain volume of orders. Business side, now is the time to monitor costs, this will allow it to renegotiate certain prices for a specific period of time, what, in addition to the fact that it will reduce the amount of its purchases, will also save him the time spent on incessant negotiations : sending price request, receipt and analysis of quotes, phone calls and email exchanges, etc.
Calculating margins
By focusing on the sustainability of the relationship with its supplier and price stability rather than focusing on obtaining a negotiation within a few percentage points, the company will be able to calculate its margins in a more reliable and sustainable manner..
A regular supply
It is obvious that a supplier will always favor a long-term customer over a one-off customer when he has to make decisions on the deliveries to be made.. A long-term relationship will secure the company’s supply.
The decrease in stock
Storage of materials, of foodstuffs or others represents a sometimes significant cost for the company. Indeed, it must provide a more or less large storage area, and this storage mobilizes cash, since the company has disbursed money to purchase goods that it has not yet sold. If the business manager is assured of pre-negotiated delivery times he will be able to reduce his stocks by working more in a just-in-time manner..
Innovation monitoring
For all sectors of activity, innovation is permanent. This is even more true for certain sectors such as construction., for example regarding building materials, particularly in terms of energy performance. Manufacturers solicit suppliers and present new products to them. It can be extremely commercially interesting for a company to be the first to offer them to its customers., which will give it a competitive advantage. However, it is obvious that it is to its loyal customers that the said supplier will offer them first..
The quality of human relations : a priority
There are several ways to establish a relationship of trust with a supplier, even for the smallest businesses.
Instead of treating them as simple suppliers who are just ready to deliver as quickly as possible at the lowest price, considering them as strategic partners will be a game changer. Respect in exchanges, attention to their own difficulties, kindness, the compliments, thanks... So many basic rules of good manners which will make relationships more fluid and pleasant, and therefore effective, for both parties. Especially since the quality of the relationships that have been established with suppliers will allow companies to be in a good position in times of crisis.. This was seen during the Covid crisis, where supply problems have affected almost all sectors of activity. It goes without saying that in this type of situation, good relationships maintained with its suppliers can allow a company to survive better than its competitors… For Jean-Michel Laidin, “Treating relationships with suppliers must be a priority for all companies. The quality of human relationships that the company succeeds in establishing is just as important as its negotiation skills.. »
