Preparing Our Business for the Economic Recovery

By Alan Winner


Preparing our business for the economic recovery includes re-aligning relationships with third-party vendors, suppliers, contractors and consultants. 

During the recession, we restructured operations, downsized, outsourced certain functions, re-deployed resources and adjusted our business plan.

But when did we last review our third party agreements with suppliers and vendors? How do the terms and conditions of doing business with these resources compare with those of our peers or competitors? As we recover from the recession, what terms need re-assessment, revision, replacement or elimination? Are there new concepts or methods that would serve us better in the current environment?

Frequently, our third party relationships are deep and long standing, which can make these discussions sensitive and difficult. Planning is essential and style, manner and approach can make all the difference in a mutually successful outcome. It may be better to have a disinterested party participate in the discussions when personalities and relationships are especially close or meaningful. After all, valued vendors, suppliers and contractors provide critical support roles in how we perform for our customers and clients.

Beyond cutting expenses through better unit and volume pricing, reduced fees, higher rebates and allowances and ancillary services at lower rates (or free), consider other aspects of the relationship that may have value:

• ·         Other products or services A vendor may have products or services that were unavailable because of pre-conditions or qualifications (e.g. minimum volume or dollar amount orders, geographic restrictions, or store layout, size or amenities). Now may be the time to have such conditions or qualifications relaxed, reduced or altered, so that new products or services or better terms can be introduced to customers.

• ·         Improved service If our vendor or supplier’s performance before, during or after the order or transaction is weak or erratic, or rebates and credits for volume-based orders have been error-plagued, now is the time to correct these problems and introduce protections against further miscues.

• ·         Flexibility Perhaps a vendor’s performance or conditions for service are rigid, scheduled or uneven, and greater flexibility to adjust purchase, delivery, maintenance or service cycles that match better with our business needs can add value.                  

With the right preparation and analysis and skillful deployment, seeking concessions or adjustments with valued third party vendors can occur without damaging the relationship, and in certain instances even enhance it.

Alan Winner

Principal

Ballast, LLC

www.ballastbusinessnegotiations.com

alanwinner@rconnect.com