Strategy Partner With the Best
Selecting a marketing vendor such as a printer, list broker or consultant may not sound like a difficult task. But, how do you know if you're selecting the "right" vendor for your business? The relationship you have with vendors, particularly with your printer, is important. (Your printer probably is your largest, unsecured vendor.)
Two basic points that come up when selecting a vendor are price and attitude. Negotiate the best price you can with your vendor, but then cultivate the relationship. Price shouldn't be the No. 1 criterion when selecting a vendor. If the decision solely is based on price, the relationship is doomed. Start with a solid foundation that can grow stronger over time with other criteria, in addition to the price you pay for services.
The second basic point has to do with attitude. Your attitude toward your vendor and its attitude toward you — both are important. Your vendor should be viewed as a business partner, and should be treated accordingly.
Personal relationships have a lot to do with vendor selection. However, there's got to be more behind the selection. Consider the following criteria when selecting a marketing vendor:
Are company cultures a good match? Match your company's culture with that of your vendor. You must be comfortable with the people and company you're dealing with. Companies generally prefer working with businesses they can identify with culturally.
The company's size also should be taken into consideration. Very large companies have tremendous capabilities and resources, but whether they're structured to provide the level of service your company needs is a crucial question. Bigger isn't always better.
What's the supplier's work experience? Make certain the supplier has experience in your particular market niche. Is it a leader in its service segment? There's no substitute for experience — you're paying for what its people know. Don't train them.
How do you view the supplier? Can you work with a particular company, almost daily at times, and how will you feel about it as a large creditor (your printer, for example)? Is this a company you can count on five years from now? If the answers are "yes," perhaps you should develop a closer working relationship.
How good is the vendor at meeting deadlines? Understand the supplier's schedule, and get its people to commit to what they promise. Will they meet your timeline expectations? How do they back up the team that's assigned to your account when one of your main contacts is out of the office?
How does the vendor feel about your company? Your vendor needs to know your company is one with which it also can grow. Show the vendor you care and are committed to it for the long term.
How much client turnover does the vendor have? Consider the vendor's level of customer turnover. Ask the vendor to discuss customer turnover with you. Find out how long its top 10 customers have been on board. Know what percentage of customer turnover the prospective vendor annually experiences. Find out why customers take their business to another supplier.
Are you serious about changing suppliers? Don't go out for bids unless you're willing to change suppliers. If the supplier feels you're simply shopping the market in order to obtain a better price from your current printer, it won't quote its "best" price to you. This can become a credibility issue. A supplier needs to know you're serious about switching companies for all the right reasons.
Most suppliers would understand if you stay with your current printer for a price difference of up to 5 percent. But, if the differential is more than that, be willing to make the difficult decision to take your business somewhere else. It's generally best not to change suppliers unless there have been issues other than price. If you like your current supplier, most likely its price will be competitive. If all else is equal or close, stay, because transitions are difficult, time consuming and there could be errors caused by learning curves, etc.
How long is your commitment? Contract for no more than a year at a time. Unless you're a very large catalog company, contracting for more than one year isn't necessary. Too many things can change, and going out for bids once a year is good, sound business. It's a very competitive business, and you want to remain current. Ensure you can opt out of the contract if you don't feel the relationship is working.
What's not included in the price bid? Is the vendor's pricing competitive and inclusive? Make sure its philosophy to pricing isn't set up to nickel and dime you. Keep in mind that it's very easy for a vendor to offer a cataloger a low price. But, a low price alone won't retain a cataloger long term.
What do the vendor's clients say? Talk with three or four of the prospective vendor's other clients. Obtain several references and carefully check them out. In addition to checking out the company, conduct reference checks on the actual team that will be assigned to your account. Learn as much as you can about how the vendor operates.
You might want to use a simple form like the one shown to rate or score your evaluation of a vendor. In our example, a vendor under consideration is evaluated on 10 different points, and is given a score from one to five. Total the number of points, and divide by 10 to determine the score. If you're in the four to five range, you probably should consider using the vendor.
However, if you have scores of one, two or three, be wary. This vendor probably isn't right for you. Or, rank the criteria based on what's most important to you. What's more, you might want to say that a vendor has to be a five for at least four of the top five priority evaluation items in order to be considered. By doing this, you're weighing what's important to your needs. It's also a good idea to create this very same evaluation form for your current vendor to be sure there's a real gain by switching to another vendor.
Vendor Evaluation Form
|Your View of Supplier||4|
|Schedules and Deadlines||5|
|Vendor's View of You||3|
|Your Willingness to Change Suppliers||5|
|Actual Client Feedback||4|
|Score (points divided by 10)||4.1|
Stephen R. Lett is president of Lett Direct Inc., a catalog consulting firm. Reach him at (302) 537-0375.