It’s a fact of life that your business success isn’t a solo mission. Your employees, your bookkeeper, accountant, customers and suppliers are all part of the big jigsaw puzzle that makes up a successful business.
Having great relationships with suppliers is absolutely essential if you’re selling a product. After all, if you run a café, your menu is only as good as the ingredients your suppliers provide.
Here are some tips from the Atticus team on how to build, and maintain, great supplier relationships.
- Do your research first
Knowing what you want, and being able to articulate that clearly to your supplier is very important. It’s up to you to get your scope of work as clear as possible, and then use this to help guide your research. Knowing exactly what kind of product you want: quantities, quality, price and timeframes, this will help you make a realistic request of your supplier.
Attend trade shows, ask around, research online and make personal contact. Find out how long the supplier has been in business, what their niche is (are they small and local or do they have global buying power?), where they are located and how long deliveries take and what promises they make about reliability.
- Always have a written agreement
This is non-negotiable. Having the terms of your agreement in writing means there’s no room for misunderstanding on either side. Make sure your agreement includes payment terms, the scope of work, frequency of supply, insurance, confidentiality, any performance agreements and potential penalties for late supply, liabilities, and exit clauses. Of course, have your lawyer review any kind of contract before it’s in place.
- Keep in touch
Communicate regularly with your suppliers, pay your accounts on time and have processes (via your written agreement) in place for dealing with disagreements.
Discussing your priorities with your supplier regularly helps ensure you maintain stock levels appropriately – and are aware of any shortages on their end, or new products they may have access to.
Creating a friendly relationship with suppliers opens up another avenue for word of mouth marketing for both you and your supplier. If you are happy with your supplier, become their advocate. Recommend them to others, give them shout-outs and mentions on your social media if it’s appropriate for you, and encourage them to do the same for your business. It’s a win-win when businesses can support each other and help build each other’s reputations.
- Resolve disputes fairly and quickly
No matter how good a relationship you have there’s always potential for disputes and disagreements.
Be polite and prompt when managing disputes – don’t let them fester into something worse. Make verbal contact first – and be conciliatory. If you do need to go to an ombudsman to resolve a dispute you’ll need to prove that you have made every attempt to resolve the dispute yourself.
Put your complaint in writing – and ask a third party to review it to make sure it sounds professional and diplomatic.
If you’ve put the hard work into developing great supplier relationships and you manage it professionally and politely your dispute has a higher chance of resolving quickly.
In Queensland, if your dispute reaches a level where you need someone else to mediate, you have two options. You can go through an out of court alternative dispute resolution process or you can go through court. This would always be a last resort, when all other attempts have failed.
If you’re a start up it can be a bit overwhelming to know where to start when it comes to sourcing the right suppliers for you. As Toowoomba locals, Atticus Business Accountants have a trusted network that we can tap into. We are experienced in providing start ups with the advice they need to get their business off the ground. Talk to us on (07) 4642 5800.