Are You Afraid To Rely On A Single Supplier?

Published by Dan Loomis | Topics: Print

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Recently, I had a conversation with a potential customer who indicated their organization was “burned” by using a single source for all of their print and fulfillment needs.

The conversation REALLY made me think.

We all agree that diversification is a great thing when it comes to our financial portfolio. Having “all of your eggs in one basket” is a HUGE risk; and most would add that’s its downright foolish. But does that mean that diversification is right for all situations? Do we need to diversify our vendors so we don’t get caught looking like a fool with our pants on the ground? (a little something for American Idol fans)

I found the comment “burned” somewhat of a glass half empty type of attitude. What if instead we focused on what positive things could result and looked for ways to minimize risks? Much more of a glass half full attitude.

As I asked myself, “how can organizations minimize the risks?”

This led me to an article I read, “Troubled Times Demand Dynamic Supplier Relationships.”  It was focused around vendor/supplier relationships in the print bindery industry, but there was some really good advice that can apply to many business relationships.  Here’s my key takeaways from this article:

4 Ways to Maximize Your Single Supplier Relationship

  1. Think Partnerships – Many organizations just see their suppliers as someone they pay each month. That’s disheartening. Vendors want to understand your needs. It’s in everyone’s best interest to do so. They cannot succeed unless you do.
  2. Understand Expectations – Establish clear expectations to facilitate rapport and minimize misunderstandings.
  3. Tap Into Your Vendors Expertise – A good supplier is on top of the latest industry challenges. They want to help. Leverage your collaborative knowledge to help resolve some of your greatest challenges.
  4. Keep Communicating – Strong relationships require honest communication about your needs, goals, and expectations.

If you focused your efforts on establishing a strong healthy relationship with a vendor; someone that you could count on as much as your best friend, your spouse, or your best hunting dog, would you still feel compelled to diversify in order to avoid getting “burned?”

Is your view of your supplier relationship half full or half empty? Give it some thought.

Check out my other articles on the value of a single source vendor:

 

About Dan Loomis

When Dan Loomis took over as a Product Director, he aspired to be like his new role model… Santa Claus. “There’s no one more skilled in fulfillment than Kris Kringle,” Dan said......read more



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Comments

1.

August 29th, 2010Tahira Endean says:

I think you are spot on. I have suppliers that if they retire or close I would really have to think about who I would work with next – some key partners who after 18 years not only can they “read my mind” they absolulutely give me 120% of their expertise and dedication on every single event. Having worked from Vancouver but around the world having been a PCO, DMC, Incentive House and back to a DMC – I know who can bring what to the table – and I APPRECIATE the knowledge, talent, dedication and insanely great partners we have in Western Canada – we are so so so lucky to be able to create events here!!!! Partners all the way, peppered with the great vendors who bring the specific attributes our clients want!

Twitter: TahiraCreates


2.

August 30th, 2010Heidi Thorne says:

Tahira has a great point about suppliers who retire or close… or get acquired and change the dynamic. As a promotional products distributor, I’ve had all three scenarios happen. So I do diversify so that I can fill customer needs without interruption.

That being said, I will say that I have about 10 “mission critical” suppliers who do so much for me, I would not diversify at all! They are my “partners.”

Twitter: heidithorne


3.

September 4th, 2010Pat Ahaesy says:

You have hit the nail on the head about good partnerships and working relationships as well as trust.
May I post this on my blog?

Twitter: pnv123


4.

September 6th, 2010Dan Loomis says:

All great comments. Suppliers who retire, close or who are acquired are all real scenarios. When faced with these situations, organizations often times scramble to find new partners. All the reason why we need to spend time building strong healthy relationships. Organizations can’t always control what happens with their supply chain, but open communication, may just help minimize the “surprise” factor; allowing more time to find and build new relationships.

Pat – feel free to post on your blog. Send me a link, I’d like to read your blog as well 🙂

Twitter: Dloomis1


5.

[…] After all, vendors are a key part in protecting and representing your brand. Is there benefit to using a single vendor who understands your overall vision, direction, and […]


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