Selecting Vendors

Excellent requests by Chris Johnston sent to me on Twitter. Team goal setting was actually a common request so I answered it in…wait for it…Setting Team Goals. If you have a team, team goal setting is a great way of getting everybody headed in the same direction. Without it, you’re kinda herding cats. You can do it, but it’s difficult, and sometimes it gives you hives.

So how do you select suppliers/vendors? In EntreLeadership I teach a lesson called The Art of Outsourcing, and in it I talk about how selecting vendors really depends on the size of your business. If you’re just getting started, you don’t have a lot of options. In fact, you’re probably purchasing in such small quantities that you may be limited to only one company. Well, one local company.

Nowadays, the internet provides so many more options for you. Don’t like the printer in your town? Great! Find one three states over that will give you a great product, price and shipping. It happens all the time now. You just have to do some research to make sure they can deliver what you expect.

No matter your company’s size, there are four things you need to establish before you work with a vendor:

• Integrity – Whether you use a vendor in town or out, the number one thing you always want to look for is integrity. I don’t care how much you like a vendor, if you can’t trust them, drop ’em like 3rd period French. Don’t allow yourself to become emotionally captive to any vendor! The bigger your company is, the more important this becomes. Why? Eventually you will do so much volume that vendors will almost become part of the family.

• Capacity – They have to know more about it than you, do something you can’t and do it cheaper than you can. You don’t want to reinvent the wheel with each project you work on. Find someone who is able to perform the task on your schedule. It doesn’t matter if you get the best price on the planet if you don’t actually get your product on time. Or when you get it, it’s not good enough.

• Price – A lot of companies think price is the most important factor. It’s not. But, with all things equal, it is the determining one. Be sure you always negotiate with your vendors to get the best deal. You have not ’cause you ask not. So ask. You would be surprised how many vendors are willing to drop their prices to get your business. Especially if you have a great reputation in the community for paying cash…on time!

• Quality – I can’t beat it into people enough that you can’t be a vendor pleaser. Way too many times I see people accept less than quality products. Worse than that is the vendor who tries to make the customer, circle the word customer, feel bad about complaining. Multiple times I have contacted a vendor to tell them their product wasn’t good enough, only for them to tell me that it was the best they could do. Or they had an issue with a machine. I DON’T CARE! I paid you for a specific product! Get it fixed…now!

As you focus on each of these points, it will become easier to select the right vendors. Better than that, as you build a reputation in the community as a fair, honest and paying customer, vendors will come looking for you.

Question: What experiences have you had dealing with vendors?

This Friday, be sure to check out my guest post on Michael Hyatt’s blog!