Signs you should switch suppliers
The right suppliers for your business are the ones that understand your business, want to grow with your business, provide quality input and give you a clear competitive advantage.
Your current suppliers may include large and small vendors who supply things like telecommunications services, office supplies, banking, human resources recruiting, payroll processing or raw materials used in your manufacturing process.
Your current suppliers may be vendors who took a chance on your business at its beginning. They may be family members. They might even be friends.
No matter who they are, sometimes, our beloved suppliers may disappoint us. Here’s how:
1. Lack of attention. You’re not feeling the same level of customer service you once enjoyed. There was a time when you called and the supplier jumped. Your requests were considered gospel. Your deadlines mattered. Your account meant everything to the vendor. What happened?
Perhaps the supplier is experiencing growing pains. Perhaps they’ve undergone recent management changes. Perhaps their attention is focused on customers who are exciting and new.
Whatever the cause, you just aren’t feeling the same kind of love. And that breaks your heart.
You can try to salvage the relationship through open and honest discussion. You can try to understand what the supplier is experiencing. You can apply patience. But – at what cost to your own business? It’s unlikely the supplier will see things as you do because, from their perspective, service levels likely remain unchanged. It might be best to move on.
2. Unjustified cost increase. Are recent supplier invoices making you cringe? Feeling financially hurt? Not sure why you’re being charged more? While most customers expect prices to slightly increase year over year (due to factors such as inflation and escalating input costs) a substantial fee hike can leave us feeling – well – abused.
Take your supplier to task on the new fees. Have a conversation to try to understand what is happening in their world. Obtain competitive quotes to compare their enlarged fees against industry norms.
If you cannot find your peace with the new numbers, then speak up to your supplier. They’ll either listen or stand firm. You’ll know what to do at that point.
3. Lower quality. It’s unlikely you’ll be willing to tolerate ongoing supplier quality issues because of the impact on your own output. You simply can’t afford to compromise the quality of your own product or service because of a weak link in your supply chain. Garbage in is garbage out, and you’ve worked too hard to disappoint your paying customers.
It’s important to make an effort to distinguish between temporary ‘blips’ in supply quality versus serious supplier flaws. The auto industry, for example, has sophisticated mechanisms in place to weed out inferior parts and flag such incidents to the responsible supplier so they may make corrections. It’s when those corrections go uncorrected that a supplier comes under review.
Exhaust all options with your supplier to improve their output so you can improve yours. Review their systems and procedures and inputs to spot quality culprits. Where possible, offer to work with the supplier to make improvements to their operations. Your insights and caring may be what they need to spot and correct problems.
If quality doesn’t improve despite such efforts then it may be time to source alternate vendors. Your business is only as good as the businesses that support it. You can’t afford to compromise on the quality output your own customers expect.
Remember, this is your business. While your supplier relationship may be personal, this is about business. Do what you can to help a preferred supplier to make things better, quickly – but don’t dwell on it too long. The price of poor supply is too great. This is about your business – not theirs.
• Ready for a switch? Consolidating your banking with one supplier makes life easier…and may save you money on the service charges you already pay. Check out the Scotiabank Get Growing Switch Package where you’ll enjoy savings, fantastic partner offers and assistance to transfer from your current financial institution.
Have you recently switched suppliers, or are you planning to? Please share your advice with other business owners by adding your comments below.
By Roger Pierce