I am an expert in sales. Most of us in the supply management function are experts as well. No, we don’t actively sell a product or service, but do work everyday with those who do. We work with all levels of the sales function, from an owner of a mom and pop shop who is responsible for all company functions, to sales and marketing managers at mid sized companies, to those mega suppliers pushing buyers into massive call centers or to the web. Put two supply managers together for five minutes and the conversation will most likely turn to war stories about sales and marketing folks who took a creative approach (ahem!) to win their business. We all have them.
However, I am not writing this to excoriate the sales and marketing function of my suppliers, past, present, and future. I am actually trying to defend them, as without this function our jobs would be much harder. I always figured that they have a job to do, as I do. While theirs may be to increase revenue and profit margin, mine is to reduce costs as best as possible and ensure continuity of supply. We have more in common than we admit to, and at the end of the day we want to help our companies, advance our careers, and go home to our families. They are not the enemy, nor or we.
So how to we leverage this buyer-seller relationship? By understanding what we need from our suppliers and leveraging the sales and marketing function to be our advocates and champions within their organizations. I sell my company, and perhaps myself, as the customer who gets an extra level of service. If I do my job right, suppliers will be tripping over themselves to make me happy.
Here are some tips and techniques I’ve garnered from nearly 35 generally successful years in supply management.
I am a defensive negotiator. I try to act a bit as an ice hockey goalie. I like to see what strategy is being used against me and hopefully make a ‘save’ and start a rush to the other end of the rink. But enough with the sports metaphors. I have seen too many ham-handed suppliers try to read paperwork on my desk, comment on the family pictures in my office, threaten to cut off supply if I don’t agree to an across the board price increase, or act so patronizingly sweet that I make sure my hand is on my wallet and that my car keys are in my pocket when the leave.
But the arms length process is thankfully changing. Relationship selling is very much the norm and there has been a thaw between buyer and seller. Both sides have reduced some of the positioning and common ground is often sought. I think there is a newfound intimacy and maturity in the buyer-seller relationship and frank discussions lead to improved performance from both sides. Increased levels of communication, supported by conversation, usually work. Perhaps the shared pressures of both the buyer and seller allow for some level of commiseration and cooperation.
Where do I begin? Personally, I hold my account manager, call it sales, marketing, ownership or what have you, responsible for the overall performance of their company. At the same time, I also need to have a relationship with one or more in internal operations. Sure, if I am a small customer of a larger supplier I may have to deal with luck of the draw in customer service or even need to expedite through web or chat. But my supply management philosophy is to be a good customer of a smaller supplier to allow for the greatest leverage or influence. I want personal relationships where I can establish and maintain them, along with the increased level of service. I want to know everyone in the process that might impact my business. Friends in operations and supply management are often the go to contacts when up against an unhelpful customer service representative.
If I do not get that level of service, I do all that I can to improve the process. Meeting one day with a company president, I told him explicitly how his customer service did not meet my expectations and how it could be improved. He took exception to my comments and challenged me to make a presentation to his sales team on how they could improve their performance. I jumped at the chance.
It was really a simple. I let them know about my business…my customers, my products, my business drivers, and how important they were in our manufacturing process. They had no idea. Next, I showed them how to read and reconcile our weekly status reports. Lastly, we paid for lunch as a thank you for all of the good that they did. It became obvious that there was a breakdown between our account manager and the customer service organization. Shortly after, their performance increased, as did their sales to us.
I am a relationship-focused buyer. I find it easier, less stressful, and enjoyable. It works for me, but not necessarily for everyone. I hear the buyer sitting next to me screaming at his suppliers all day. I don’t have the energy or temperament for that. Every supplier relationship is not made in heaven and is different. Buyers, and sellers, need to weigh the depth of the relationship in the context of the business environment.
But I never forget it is business. I may reward a trustworthy supplier with good performance direct access to engineers, designers, and requesitioners. I may restrict others. Relationships to me are on a moving continuum and I use them to my benefit to manage suppliers. While there may be some who think relationships favor the seller, I don’t belong to that school. One can have a strong relationship and still actively negotiate the pertinent levels of service.
Innovative sales techniques
Sales organizations today are under a lot of pressure, perhaps more than the buyer understands. In the retail sector, technology and shifting consumer behavior have upended typical sales channels and relationships and some of the retail behavior is sneaking into the industrial marketplace. Generational shifts and the evolution of the traditional buyer and seller roles and relationships add turmoil to an already dynamic process. Add expanded software and automation to the process and buyers and sellers may not even look each other in the eye. That doesn’t work for me.
But a creative approach to sales may help. I’m presently working on a sourcing project, trying to identify and qualify suppliers for a complex assembly purchase, one that still needs to be further defined by the engineering team. I have identified a half dozen suppliers who have an interest in taking the next steps in the proposal /quotation process. I’ve had conversations with each one to explain the project and determine their level of interest.
I’ve asked each of those suppliers for a capabilities document that I can show my client…not just a link to a website. One supplier went a step further. He sent me a personalized video tour of the factory, touching on all of the essential elements of my request for proposal. It was well done, comprehensive, and elegantly simple. I got to know him, the staff, and had a plant tour.
That innovative supplier is in the lead!