We live in a time where so much of our business, for better or worse, is conducted electronically.
On the positive side of the ledger is the fact that information can be searched and retrieved at the speed of a simple mouse click. Conversely, there are times where we may not know exactly what we are looking for or are confused by what we’re finding. It’s then that we desperately need human contact for further explanation, only to realize we aren’t quite sure who to call or that we haven’t developed a good working relationship with our local supplier.
There are several questions contractors should be asking when deciding from which material supply house to entrust their product purchases. These same questions, or very similar questions, should be asked by material supply houses when determining which manufacturer they should choose to do business with.
- Why do I choose to purchase products from this company? What sets it apart from the rest?
- Does it provide value to my business or just product?
- Does it have sufficient inventory, or does it constantly need to “special order?”
- Maybe most important, are they helping me grow my business?
People need people who know
I’m a firm believer that people buy from people and that building relationships is still paramount in our industry. However, times have changed from buying from “friends” simply because we like them. Now, people not only need to build relationships, but they need to be technically proficient with the products they represent. This is just one thing that will help set their company apart from the competition.
Does my material supplier provide value to my business or is it only interested in selling me product? What is it doing to bring value to my business? Are representatives accessible when I really need them and are they available for:
- Troubleshooting projects
- Keeping abreast of industry trends
- Providing solutions or the forum where solutions can be found
- Facilitating training on product systems
There will come a time, if it hasn’t happened already, where you’ll need some assistance, whether it’s technical help and support, or perhaps just a fresh perspective. This is where your material supplier can really set itself apart from the rest. This is a time where it can provide you with real value, tangible or otherwise. This is the time where real relationships are forged and solidified. Relationships that aren’t built on lowest price but on added value. These are the working relationships that will stand the test of time.
I have talked about this in previous articles, yet I find it vital that we all understand the working dynamics and relationships at play here. We are all in this together: contractors, material suppliers and material manufacturers. For our industry to grow and be sustainable, we need to align ourselves. By working together, we can achieve great things. We need to realize that the closer we are in this relationship, the better off we will be.
Inventory control
There was a phrase tossed around quite extensively in the early 2000s: JIT inventory control, as in “just in-time” inventory. It loosely meant that manufacturers would keep little inventory on the floor and would manufacture product based upon historical trends and forward thinking. This can be highly effective in keeping inventory costs down but requires a very high degree of accuracy in forecasting what, when and how much to manufacture. When done well, it can significantly reduce inventory costs and increase profits. Done poorly and there’s an overabundance of some items and a shortage of others.
If we’re being completely honest here, our industry doesn’t have the best track record for planning our decorative purchases well in advance. Taking what we have just learned about JIT inventory, we can see how lack of communication from manufacturer to supplier and supplier to contractor can snowball in a hurry and be disastrous on the job site.
On the other hand, where a contractor and material supplier have developed a strong relationship with good communication and trust and have also built a hearty relationship with the manufacturer, most of these inventory problems can be significantly reduced or eliminated altogether. Don’t believe me? Ask one of our industry’s most successful contractors, Tom Dombalis, president of Atlantic Coast Concrete, about his material supplier and material manufacturer relationship and how it has been a benefit to his business. You can find him on LinkedIn.
It takes three
Lastly, is my material supplier helping me grow my business? What is he or she doing to tangibly assist in my business’s sales growth? If the material supplier has been asking his material manufacturer the same types of questions as the contractor has been asking of him, then this could be the making of a beautiful relationship. This is where one can really shine and differentiate oneself from the competition.
If a contractor and material supplier have taken the time to build the type of relationship that we have mentioned here, and the supplier and manufacturer have done likewise, then why not put it all together? We should never be afraid to develop a relationship with all parties in the supply chain — contractor, supplier, manufacturer.
If, as a supplier, you’re worried that the manufacturer may “sell direct,” then why are you purchasing from him in the first place? This relationship of trust is built from the very beginning and nurtured as outlined here.
I guarantee you that the best types of manufacturers have sales tools, sales aids, programs, lead generators and architectural relationships, to name just a few. When fully implemented, these tools are not designed to sell product, but rather promote value.
When the relationship circle is complete between manufacturer, supplier and contractor, great things can happen. Manufacturers often receive calls from custom home builders, architects and others looking for quality contractors to complete their project, custom home or hardscape. Who do you think the manufacturer is going to recommend? The contractor who he knows very little about or the contractor who he has built a strong relationship with through his supplier?
This also can work in the other direction. Many times quality contractors are called by their repeat clients looking to entrust their projects with someone they can trust. Who is the contractor going to use for these projects? A supplier with whom he has no relationship or a trusted supplier with whom he has worked side by side and can provide the products and systems the contractor has come to know and trust?
