Your business can’t run itself on its own. You will need help from the outside. There are business out there willing to provide what you need, from raw materials to finished products, from business services to delivery services. Picking the right vendors starts inside your own company, so here are a few guidelines.
Know What You Need
Probably the most important step is the first one: figure out your own needs. What do you need from the outside and what are your requirements. If you supply goods to your customers, you might need raw materials, or even the finished products, delivered to you on a regular basis. Map out what you need from vendors supplying these to you in terms of price, schedule, reliability, etc.
If you are a service organization, you may need communications set up, tools for your trade, or even vehicles for delivering technicians to their jobs. Decide what you need in terms of your business voip provider, equipment provider, or transport provider. Make your decisions before looking for a provider so you know not only where to look, but what to look for and how to tell if a potential vendor meets your needs.
Cast a Wide Net
Once you know what you are looking for, start putting together a big list of the providers in those areas. You want to include lots of potential businesses. You never know if one of those few you missed were your perfect fit or not.
This might take some time, and the temptation to cut the process short by taking a friend’s recommendation or using a big name with a large advertising budget can be strong. Resist it, you want a vendor you can rely on, not one your friend relies on, or one that just happens to pop up in your in your news feed.
Narrow It Down
Once you have your long list, filter it down to look for your short list. Take a hard look at each company and decide if they meet your criteria. This isn’t yet the time for in-depth research, you should be able to decide how well a potential vendor meets your needs with a quick scan of their materials. Do they put emphasis on the type of business you will be doing with them, or are they scattered across many fields, trying to meet every need?
Get in touch with your short list. In some cases, this is a strict process involving Requests for Proposals (RFPs) but in others it is a simple phone call or lunch meeting.
Get a feel for them, how well they respond to a potential new customer, how knowledgeable they are about their field, and yours. If you don’t have a good feeling at this early stage, there might be a real problem your subconscious is trying to point out. Don’t cut contact on a gut feeling but use that to lead you into deeper research to see if there is any evidence to back it up.
Trim the List
You should have enough information to cut down your short list even further by now. Here’s the time to look beyond the numbers and think about the big picture. Will this vendor grow into a partnership with you? Are you going to get their support, and will they make you a priority when you need it? Will you value them enough to overlook a few mistakes when they are honestly trying their best? Will a single error outside either of your control sour the relationship? Depending on how critical this vendor will be to your company’s future, you should be sure to give priority to business partners over other service providers.
Make an Offer
Once you have it down to your finalists, hopefully in a prioritized list, approach the vendor to negotiate an agreement. When you walk in you need to know what you can accept and what will cause you to walk away and go to the next on your list. Your goal in this is not to get the best possible deal for your company, but the agreement that benefits both of you.
At the end of a successful negotiation there should be no lingering resentment, but an eagerness to succeed together. You might find it beneficial to take on more than one vendor for a single role. But limiting the number of vendors you work with limits the amount of work you need to maintain that relationship.
The vendor relationship doesn’t end with signing that contract, though. Monitor their performance. Make sure they follow through and smooth out any problems along the way. Support them as you would want them to support you, in good times and in bad. But if they fail to make it work, you will need to try again with another vendor. Keeping close track of the relationship will let you know when it is time for you to go your separate ways. Choose vendors carefully, and choose wisely, and both your companies can succeed.
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