Building Good Relationships (Suppliers)
Usually, when we think about building good business relationships, we focus on keeping our customers happy. But remember, in basic business Accounting, there are two types of Business Relationships:
1. Debtors – those who pay you or owe you money, i.e. Customers or Clients
2. Creditors – those you pay or those you owe money to, i.e. Banks, Service Providers and Suppliers
The contributed post below deals with the second business relationship – your Suppliers. Because it is just as important to foster good relationships with your suppliers as it is to keep your customers happy.
Cash Flow Challenges
I found the biggest snag about paying suppliers when I was starting out was actually having enough money to pay them.
Simply put, If you’re not generating money fast enough to pay your suppliers, your business can go bust.
I nearly came to this point a few times in my blogging business.
I only had one supplier, Wealthy Affiliate, my one-stop-shop, where I bought all my tools of the trade and learned everything I needed to learn about building my websites and affiliate marketing.
I was paying Wealthy Affiliate monthly and it took me a good few months longer than expected to start turning a profit.
Fortunately, my husband rescued me in November 2016 by paying my subscription at Wealthy Affiliate for an entire year.
By the end of that year, I could afford to pay the annual fee myself (more about that in the income report I’ll be publishing next week).
So I was in a position to keep my main supplier happy, Wealthy Affiliate, but my main creditor? In my case, that would be my husband. Until I’ve paid hubby back for the first year, I haven’t really made good with all my suppliers, have I? So that’s my next business goal.
On with the contributed post…
“Supplier Demand” – What We Need To Make Them (And You) Happy!
It’s been said a million times before, it’ll be said a million times again, relationships are the key to every part of business success.
From the beginning when you are hiring employees and developing their skills, you can’t underestimate the importance of good relationships within the workplace.
But what about the external relationships? Namely, suppliers? It’s a very difficult relationship to navigate, keeping your suppliers happy. If they don’t feel they can work with you anymore, it could leave you with many different problems!
So, in terms of keeping abreast of trends and also working on relationships with your suppliers, how can these two work together to make sure that everybody is happy?
Make Communication Your Priority
This is how you should keep track of every single relationship you have, but it’s a sure-fire way to take advantage of current technology.
In having as many different communication channels as possible, you are able to inform your supplier if any issues could delay payment, whether this is in relation to accounts payable problems, or there has been an issue somewhere else in the chain.
In relation to the accounts payable systems, there is a case to be made for automation, and this doesn’t just benefit you because there’s one less thing to think about, but it’s also promoting a sense of trust.
Your suppliers can trust you to pay on time, every time.
It’s Business, So Treat It Accordingly
Paying promptly, getting on the phone if there’s a problem, or just being honest in every aspect of the process, are the components of transparency in business.
Remember, your suppliers will have many other clients, not just yourself, and so, treat everything as “just business“, as opposed to a personal relationship, even if this means they have a problem at their end.
Treat them with the same respect as you would want to be treated.
And because suppliers have various relationships with businesses, as you would with various customers, the benefit of the doubt is a notable quality to have.
Everyone is busy, so you can’t expect your supplier to be solely dedicated to you, and as soon as you get your head around this, the more realistic your expectations will be.
The Issue With Appropriating Blame…
When there is a problem on one side, it’s very easy to blame the other. This can cause very fractured relationships if you constantly point fingers at the suppliers and their processes, but, as with any dispute, it’s important to look at both sides.
If you endeavour to work at solving the problem, this will help to repair your relationship so you can work together better in the future, but it shows that you are quick to solve issues, making you a trustworthy client.
The relationship between a business and a supplier isn’t always smooth sailing, but the potential problems can be ironed out by having an open and honest relationship, but also knowing where you fall down in terms of the key processes, like communication, and problem-solving.
Utilizing technology is very important when it comes to client relationships now, and the more you focus on communication, the better your relationship will be as a result.
How many suppliers do you have in your business? And are you managing to pay them all on-time, every time?
How did you manage your Cash Flow in the early days? Did you have a benevolent creditor who could help you out, like I did? Or did you have to go to the Bank or apply for a Grant to give you the cash injection you required?
It’s your turn. Share your personal story in the comments below.