Exclusive: Building good supplier relationships
Supplier relationships are a two-way street; use these tips to stay in your suppliers' good books.
If you feel like the world has grown more adversarial over the years, you’re probably not alone. Competition rules the day rather than cooperation, meaning goodwill and solid relationships are extremely valuable currencies. The thing is, the customer isn’t always right — and placing an order doesn’t give you automatic power or moral high ground.
Good supplier relationships, especially in the adhesives industry, can’t be taken for granted. They don’t just happen. Both parties must be active about cultivating a respectful and collaborative link. The following provides some guidance for developing mutually beneficial relationships like these.
Why Strong Relationships Matter and Tips for Building Them
Think of all the other industries that adhesive companies serve. Manufacturing, packaging, electronics, construction, automotive and many others rely on timely service and reliable products to get their work done.
Cultivating strong business relationships requires that we think about how we add value to our downstream customers, including the end-user. In many instances, improving the customer experience delivers benefits that work both ways — such as looking for methods to improve turnarounds, lower operational costs, enhance efficiency and reduce waste.
Product quality is a major piece of this puzzle. Manufacturers with great supplier relationships have a partner with whom they can discuss their current product requirements as well as future plans and innovation goals.
In other words, an open and collaborative approach to communication means a better match between product and application, faster times to reach the market and better and longer-lasting products. The best suppliers and distributors don’t just sell products — they act as technical consultants and product advisors. They’re selling an experience, too. The better that experience is, the greater the benefit for both parties.
What can both parties do to unlock the potential of good supplier relationships? Here are a few ideas.
1. Pay All Invoices on Time
Hopefully it goes without saying, but the most important thing to do as a customer is to pay your invoices on time. Suppliers rely on steady cash flow, and value customers who pay when they’re supposed to. Over time, regular payments may allow you to renegotiate more favorable terms or payment schedules with your suppliers.
For now, pay on time every time to make yourself a no-fuss client and place yourself in the top tier of their business partners. Not having to worry about receiving payments on time is, for lack of a better word, priceless.
2. Give Suppliers Ample Lead Time
It’s not always possible to give suppliers as much lead time as they’d like. However, most of the time, developing strong relationships means springing fewer surprises whenever you can help it. When you receive updates or process new data that stands to affect your turnarounds, share it with your partners. They’ll want to know about the reality on the ground and how they — and your expectations of them — stand to be affected.
Being realistic about lead times and actively sharing information means both companies enjoy stable workflows and less frequent crunch times. It also builds that essential goodwill we mentioned earlier.
3. Prioritize Great Customer Service
As a supplier, customer service probably differentiates your business more than any other factor. Claims about carrying superior adhesives will get you only so far. How you treat customers, the timeliness of your responses, and the breadth and quality of the services you provide all speak more loudly than your product copy can.
Across all industries, unplanned downtime carries an average price tag of $260,000 per hour. Suppliers should add value to another enterprise — not detract from it. To that end, suppliers of adhesives, equipment and other critical supplies must find new business models to keep their customers supplied, prepared for the future and moving forward.
Exchange services can be a great way to get replacement equipment to clients quickly. For any other inquiry, suppliers must have the resources in place to receive and fulfill orders quickly, provide complete and time-sensitive product troubleshooting or render aid of any other kind whenever it’s needed.
4. Expand Your Digital Capabilities
The fourth industrial revolution — Industry 4.0 — features lots of technologies to make business communication more effective and industrial processes more efficient. Best of all, modern technology helps supply chain partners work in better harmony with one another across the vast and unpredictable global marketplace.
Customer relationship management (CRM), enterprise resource planning (ERP) platforms and artificial intelligence applications are part of the business landscape. Tools like these help automate interactions between suppliers and customers — such as tracking and restocking low inventory and generating orders and invoices.
Predictive analytics even help anticipate customer demand and market disruptions before they arise. A supplier that can help customers get ahead of the market and order materials or parts before demand and prices tick upwards again could become a partner for life.
Making wise investments in technology lets both parties focus on the more humanistic parts of the supplier-customer relationship. Automating back-office and manufacturing functions within the supply chain gets both operations running smoothly, ensures a higher standard of service and helps everybody refocus on core competencies, communication and further product innovation.
5. Personalize Every Relationship
There’s no denying the impact of a personal touch. The world of manufacturing and distribution is global, but customers today want to feel they’re doing business in a personal way — whether geography separates them or not. Suppliers should be working to personalize every interaction from the very beginning. Learn names and titles early in the onboarding process. From there, make sure no piece of outreach or correspondence feels generic or boilerplate.
Invite partners and potential partners to tour your facility or to take part in workplace functions like picnics and sponsorship opportunities. Work to fully understand the nature of each other’s business and how you create value for one another.
After you’re in business together, include them in your strategy conversations and keep up the flow of information. No matter which side of the transaction we’re on, everybody wants to feel like they’re dealing with human beings invested in their success.
Massive Demand for Adhesives Requires a New Approach
According to research, by 2026, the global market for industrial sealants and adhesives could be worth $88.25 billion. With exceptionally strong activity in the construction, automotive and consumer manufacturing sectors driving growth, now is a lucrative time to be involved in adhesives.
Learn to demonstrate how your distribution or supply company is genuinely different, beginning with the quality of your customer experience and relationships. Customers don’t get a free pass, but with global competition only rising, they do have the power to choose from many suppliers. Based on the available evidence, we can expect partners with a handful of attractive qualities — like a strong commitment to the environment, continuing innovation and humanistic customer service — to rise to the top. CS
Megan R. Nichols is a technical writer and blogger. She’s covered several industrial industries including manufacturing, HVAC and construction for sites like SNIPS Magazine, Manufacturing Tomorrow, and Thomas Insights. Megan also publishes easy to understand manufacturing articles on her blog, Schooled By Science, to encourage others to take an interest in this industry.
CONTRACTOR SUPPLY MAGAZINE
The April/May 2024 issue of Contractor Supply magazine is here!
This digital edition is sponsored by BECK AMERICA Inc.
Our cover story, Masters of Fasteners, visits Interstate Screw Corp. of metro Miami, which serves the fastening needs of south Florida, the Caribbean and Central and South America.
Also in this issue,our Industry Updates cover Adhesives, Tapes and Sealants, Anchoring Systems and Safety and PPE.
This digital edition is fully searchable and contains live links to every advertiser and new product listing. Click away!
