It feels like everyone is vying to be a customer of choice in crowded supply chains.
Buy-side supplier managers have budgets but often a limited choice of vendors.
The supplier managers are seeking proactive suppliers who are continuously improving and contributing cost and value proposals that improve the contract outcomes.
It can be a tricky balance between getting the attention of busy suppliers with asking too much of them.
On the one hand, vendors are bombarded with buy-side initiatives, and they need to consider the return on investment of their efforts.
Some buyers I work with say they feel deprioritized compared to the original opportunity that the supplier proposed during the selection process.
On the other hand, some vendors I work with say they feel their buyers don’t care about their business goals.
These vendors also feel disappointed compared to the original opportunity proposed during the selection process.
When the supplier manager is navigating these waters, it is useful to look at the behaviour on both the buy and sell side. Often responses are driven by the other party’s actions or we can draw incorrect conclusions by making assumptions.
These might be signs that you are asking your suppliers for too much:
What you are doing
How it feels to your supplier
Evaluation of the existing vendors’ business practices that are beyond the industry norm
Like the supplier manager is taking advantage of their leverage
Expecting work that is not included in the original scope of work / agreement
You failed to accurately specify the work or don’t wish to fund additional needs
Asking for your supplier to contribute to the relationship but not reciprocating (for example, if they want a referral)
You don’t care about their business being successful
These might be signs that you are not asking enough of your suppliers:
What your supplier is doing
How it feels to you
They only contact you proactively when they want something
Like they are complacent
Putting a price against every request or discussion
Like you are in inconvenience to them
Their problem-solving or improvement ideas are thin and unsubstantiated
Like your business is a stop-gap until something better comes along
Ultimately, becoming a customer of choice is a team approach that requires the buy-in of a multi-functional team of business colleagues and one or more suppliers. The right strategy, relationship style, contractual terms and motivation can deliver positive outcomes for all parties.
But grating feelings about the relationship behaviours are an indication of poor quality that is already (or will soon start) leaking into the contractual performance and cost. Addressing the practices behind these feelings though regular, open and action-driving communication is the first step towards appropriately negotiating a beneficial relationship.
A customer of choice feels:
- Listened to and respected.
- Able to take appropriate actions as a response to listening to their suppliers.
- Proud to be part of a high-performing team.
- Like an effective champion of the end customer.
- Regardless of the balance of power, the current relationship was mutually agreed.