Five Ways to Get the Best Deals From Your Suppliers

By Scott D. Hollis Senior Vice President, Avendra, LLC | April 24, 2010

Today, the best advice anyone in charge of supply chain management can give is take a strategic, long-term view of your contracting efforts. All of us want to save money, but it takes more than hard bargaining to get the best deals. It takes vision and the ability to look at the entire supply chain from field to table to identify the most effective ways to make the overall supply chain more productive. Based on many years of experience in dealing with over 900 suppliers and a team of 50 commodity experts, I would suggest working with suppliers, not working at odds with them, to take costs out of the system. Based on this, here are some ideas:

1. Cooperation and Communication

Top on the list of how to get the best deals from suppliers is to cooperate and communicate with them. This can be a very time consuming activity, but well worth the effort if you expect to develop true partnerships with your suppliers and ultimately drive costs out of the supply chain. Suppliers need to understand your business, and you need to understand theirs.

For example, you might consider setting processes in place to routinely meet with a wide range of suppliers to better understand their offerings and expertise. Structure your meetings to allow time for them to tell you what is new as well as time to for you to tell them your problems. Challenge them to help you find better products or services to meet your specific needs.

Last year, when several jurisdictions around the U.S. enacted zero transfat regulations, our customers were in need of quick solutions to provide their guests the products they wanted, but also to comply with the law. What we did was to closely work with our suppliers to come up with a variety of solutions. And, we asked suppliers to help us train customers by jointly developing webcast training that featured a number of suppliers themselves explaining the innovative solutions.

You might also consider establishing a board comprised of a number of suppliers across a range of product categories that meets regularly. The communication and interaction that takes place at these supplier meetings can open doors to a multitude of fresh ideas and potential cost-saving opportunities.

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