Jun
21

Vendor Relationships: Top 10 Ways To Thrive

Vendor Relationships: Top 10 Ways To Thrive

June 21
By

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Vendor relationships are critical to MSP’s success, whether it’s the delivery of  IT equipment, cloud services, or disaster recovery solutions. While SMBs are increasingly offloading internal IT functions on to managed service providers as a way to control costs, simplify infrastructure management, and accelerate business growth, it is not uncommon for MSPs to obtain a variety of their products and services from third-party sources.

1. Choose Vendors Wisely

The easiest way to get vendor relationships off on the right foot is to simply be diligent in the selection process. Instead of rushing to partner up with the first company that looks the part, take some time out to carefully evaluate multiple vendors. Qualifying factors to keep in mind may include:

  • Your individual needs
  • Vendor expertise
  • Vendor strengths and weaknesses
  • Contract terms
  • Cost and pricing model
  • Support options and response time

It pays to put some thought into the selection process. The decision you make here will have plenty to say about your ability to grow and prosper with chosen vendors.

2. Strive to Build Partnerships

Handshake of businessmen greeting each other

Relationships are great. Partnerships are even better. ITSPs will benefit most from strong, collaborative partnerships built on trust and value that is apparent to both parties. The challenge is budding these relationships on a level where your counterparts actually feel like partners rather than vendors. Limited interaction beyond the occasional transaction is the biggest barrier relationships and strategic partnerships. Not all relationships are equal, so a short list of vendors, and an even shorter of list of genuine partners might be the most realistic outlook.

3. Understand the Vendor Perspective

It’s only possible to know so much about a company’s business model or how they operate on a day to day basis. Still, it helps to have some basic knowledge of how suppliers operate. For example, having some familiarity with how a specific vendor delivers their technology in terms of production processes and turn-around can prove helpful for meeting your own objectives and deadlines. A general understanding of how your suppliers make their money and the challenges they encounter will allow you to anticipate various stages throughout the relationship.

4. Embrace Transparency

Transparency is the key to forging relationships beyond the negotiation table. The best thing about this concept is that it’s versatile enough to fit in multiple strategies. From a communication standpoint, it could be a case of meeting with vendors to discuss implementation plans and challenges. On the content marketing front, it might be a press release that introduces new technology offerings and highlights past accomplishments. In either case, transparency gives vendors a deeper look into your situation and a better understanding of how they can contribute to the cause.

5. Make Your Priorities Apparent

The customer should have a general understanding of their vendor’s business model. Those same vendor partners should have a clear understanding of your company’s vision as it relates to the relationship. In the beginning, sit down with the appropriate parties to share your immediate goals and where you see your business in the next couple years. Also, don’t hesitate to keep vendors up to date product launches and ongoing developments. A well-connected partner may be able to provide unique and valuable insights not available via typical channels.

6. Go Above and Beyond For Vendor Relationships

Believe it or not, but a relationship built on ‘back scratching’ can be just as prosperous as one built around exchanging money. In simple terms, you don’t necessarily have to buy technology products or services from a supplier to be a valuable partner. A prime example is the client who lends their expertise to help solve a problem, or simply recommends qualified leads who can benefit from a vendor’s offerings. These efforts will be remembered and hopefully work to your advantage when the time comes to negotiate a contract.

7. Appoint Dedicated Handlers

In a previous post on lead nurturing we talked about how important it is to make sure you’re speaking with the right contact people when romancing new prospects. Likewise, you should ensure that partners are dealing with the right person on your team. A designated vendor manager will generally be responsible for communicating with vendors via phone, email, and on-site visits. This dedication will result in smoother interactions that enhance the decision-making capabilities of both parties.

man in business suit with checklist

8. Always Let Cooler Heads Prevail

A couple married for any length of time will tell you that all relationships have their ups and downs. When things go awry – and more than likely they will – you must know how to respond without making things worse. Vendor relationships can be strengthened a great deal when you work as one to resolve issues rather than blowing up and looking for someone to blame. This is part of the unique skill set a vendor manager brings to the table.

9. Incorporate Vendor-friendly Tech

Like CRM software to customer relationships, vendor management software helps streamline the process of managing the interactions between companies and the organizations that provide them with products and services. An ideal platform will centralize the data from all suppliers while providing features that allow you to maintain profiles on each individual firm, track and evaluate performance, perform risk assessments and much more. You’ll score an even bigger bonus by investing in tech that integrates with accounting apps and other existing systems.

Note: Also referred to as supplier management software, vendor management software doesn’t enjoy the notoriety of project management, CRM, or marketing automation software. Business software directory Capterra is a great place to get up to speed with some of the leading products in this emerging field.

10. Plan For Vendor Continuity

You may have caught us stressing the importance of disaster recovery once or twice. We often apply it to IT systems, but in reality, you should compose a continuity plan for every single layer in your ecosystem of assets. This goes for tangible components like server hardware and power systems as well as vendor relationships. Service providers and their vendor partners should know how to respond in the event that chaos ensues and things deviate from the norm.

Whether it’s in the context of spouses or B2B partners, it truly does take two to make a relationship work. While the vendor usually shoulders the heaviest burden, the customer also bears responsibility of mission-critical significance. Accepting your role is the first step on the road to a long and prosperous relationship that is mutually glorious for both teams.