Many fortune 500 companies are facing the same questions across the board regarding suppliers and how to compete in the global economy at a hyper speed.
The decision to shift from hundreds of smaller suppliers limited to a few areas to a few national suppliers is a hard sell in the beginning. Having a business partner that can grow with your company across the entire nation makes good business sense. This concept is not always an easy transition for companies to make
internally. It means giving power to someone above your pay grade and often cutting ties with old suppliers that you have become attached to over the years. Often I am met with terms like loyalty and tradition and so on…
I will ask one key question in rebuttal to this debate: Are the needs of your clients coming first or are your old business alliances coming first?
Being ethical is doing the right thing for your client first and foremost. Are you being ethical by not giving your client the highest quality service or transparency in billing possible? Are you being ethical by not being proactive and implementing fail safes to prevent future errors from reoccurring because of tradition?
Smaller suppliers need to be able to produce transparency in reporting and set quality control standards that are in the best interest of your clients first and foremost not what is most convenient for their own team.
Time is worth more than money. Having to process invoices from 800 suppliers every week takes a great deal of time and money for your administrative team. Larger companies that I speak to have what is called a preferred supplier list because of this growing mountain of work. Having preferred suppliers nips that in the bud quickly and allows the team to devote more time to quality control.
Many larger companies developed this list because it made good business sense to make the transition as they kept investing more time into each supplier relationship instead of more time into the clients relationships. This is because they needed less suppliers for more areas of the nation and suppliers who can offer more services across the nation to those who matter most: the clients.
So does this mean that these large companies are unethical because they use only a few preferred suppliers? In my young opinion it comes to making sound business decision based on the quality of your services in record response time.
You should be loyal to your customer first and foremost and give them the best service possible with transparency in billing and quality control that is standardized or should you offer them a service that is outdated because of your old alliances?
Old alliances have a certain level of nostalgia and comfort that are undeniable. I would say that those relationships are worth preserving if the clients get what they need when they need it. The client should come first, always. Evolving past business relationships that are limited and moving toward business relationships with a mindset for growth are key to your clients prosperity.
Having a National Facility Solutions Group that is set up to grow with you will enable your company to bypass many growing pains for years to come. Plan for tomorrow and keep pictures of yesterday in your album on your coffee table at home. Be ready for the future of competitive and transparent commerce. One click of the mouse can change your company overnight.
To Growth and Creativity!
Aimee Pugh Business Development EnviroUSA