A business faces many challenges, but nothing is more challenging than developing and maintaining vendor relationships. Business relationships aren’t always easy or straightforward. Each business wants what’s best for its bottom line, so it’s essential to know the art of collaboration.
Vendor relationships come with their own unique challenges that can be mitigated by entering into them correctly from the start. Three of the factors that matter most are how you select a vendor, how you negotiate the contract, and how you communicate.
1. Vendor selection
When you want to do business with another company, it’s imperative not to jump into the relationship blindly. Their product or service might be exactly what you need, but if they don’t play by the rules or if they’re difficult to work with, it’s not worth it.
Spend time qualifying potential vendors by your own high standards, and take time making a decision. If you overlook certain red flags, it could cost you.
For instance, landlords need to be selective about the property management company they hire. If the company has to evict a tenant, certain mistakes can cost the landlord more money and even encourage the tenant to cause damage. Courts are known to rule in favor of the tenant when the landlord breaks the law.
Great property management companies have experience handling the legal aspect of an eviction as well as working cooperatively with the tenants. For example, they know the value of communicating with tenants rather than treating them harshly. “Rarely is an eviction a total surprise,” says property management company Green Residential, “but everyone deserves an explanation. Open dialogue can make the rest of the process much smoother.”
Other vendors that need to be chosen carefully are any contractors that perform work that requires a permit. For example, if you’re running a local mail center business and you decide you want to expand the size of your bathroom, you probably need a permit.
If you don’t obtain the correct permit, the city “could double or triple the permitting fees,” according to legal experts at Nolo.com. “It may also shut down your project or require you to tear down your work (for example, remove a wall to see what’s behind it) if there is a question as to whether the work was done according to building code.”
Be selective and never settle for a vendor that compromises your integrity with the law.
2. Negotiate the contract
How you negotiate your contracts is as important as the terms you agree to. The way you negotiate – and how you take control – will set the stage for your relationship with a vendor.
Negotiating tells the vendor that you think for yourself and know what you want. The harder you negotiate, the more boundaries you set with your vendors.
If you don’t negotiate, the vendor will continue to see you as someone who will go along with anything they want. They may try to change the contract terms or take advantage of you in some way.
Vendor contracts are typically one-sided, heavily leaning in favor of the vendor. You want to do everything you can to balance it out. If you’re not sure how to negotiate, Techtarget.com offers a straightforward, four-step guide for taking control of a contract during negotiations.
How you communicate with vendors determines how they communicate with you. If you’re willing to set the example of transparency and patience, you’ll have a better chance at being treated the same way.
Vendors may be corporations, but human beings run them. It’s important not to lose sight of this fact. Every person you communicate with has a life just like you, and they probably have a family they go home to after work. They may be bound by the rules set forth by the owner of their company, but a little kindness can go a long way.