Successful retail is driven by your relationship with your customers, but it is sustained by your relationships with your suppliers.
And yet... how much effort goes into nurturing these relationships, building partnerships and preparing for vendor meetings and purchase negotiations?
Sadly, the answer to this question is probably: Far too little.
It's easy to understand why. Today's merchants are pulled in dozens of directions. They need to stay on top of what's happening in the market and their customers' expectations. They are creating business strategies, as well as partnering with their colleagues to complete the hundreds of tasks that go into selecting, buying, presenting and selling their product to the consumer via multiple channels and locations.
But if your merchants aren't fully prepared for vendor meetings and negotiations, how much opportunity are they missing?
If merchants go into vendor meetings...
Without a clear business or partnership objective, they could miss an opportunity to grow the business
Without a purchase budget, they could under- or over-spend and end up with the wrong level of inventory
Without an understanding of the vendor's current business priorities, they could miss a chance to negotiate a lower cost in exchange for something the vendor needs - like a new product test
So what do they need to do to prepare?
First, they have to know what's open for negotiation. It's not just about unit cost; there are dozens of potential areas for negotiation and agreement ranging from what part of a vendor's line they can select from to casepack sizes to marketing support.
Next, they have to think about and assess their negotiating position. For each potential negotiation point they need to know:
What they want
What they can offer the vendor
What the vendor (likely) wants
What the vendor has to offer them
And let's not forget they also need to work out the details of each specific meeting plan: Creating an agenda, knowing what to expect and preparing ahead of time the tools and references to help make the right decisions for their business.
We're pleased to announce the addition of five new courses covering Vendor Relationships and Negotiation within Merchant Academy. The courses identify potential areas for negotiation and agreement, as well as provide practical tips on how to:
Think about and assess your negotiating position
Prepare for vendor meetings
Guide the meetings to reach the outcomes needed for your business and for strengthening the relationship
For more information, please email us at info@merchant-insight.com.