Keys to Building a Strong Vendor Network
By Gregg Kussmann, Partner & Director of Business Development, QuickFrames
Being successful in any business requires a delicate balance of the right products and people, both internally and externally. Companies in metal fabrication, structural engineering and construction are no different. But sometimes building such a foundation is easier said than done. To help you get started, here are some tips about what it takes to build a strong network and specifically handle vendor selection.
Start with the 80/20 Rule
The 80/20 rule can apply to a lot of areas of a business, but the gist is that 20% of X yields 80% of Y. For instance, 20% of your customers are often responsible for 80% of your revenue, meaning that those 20% should get a significant portion of your attention and care. When it comes to vendors, you can use this principle in a similar way. Odds are good that a small percentage of your vendors provide the lion’s share of impact on your outcomes.
So, start by exploring where you’re weakest. Maybe your projects generally stay on schedule, except when you get hung up by angle iron rooftop equipment supports (roof frames). While you wait on mechanical locations, everyone loses time and money. If this is a recurring problem, it’s also a good place to start finding a new vendor. If you went with QuickFrames adjustable, bolt-on roof frames instead, for example, we may only provide a small portion of the overall project but we also provide immense value in keeping it on track.
Get Social Proof
Once you know the main areas that can pack the greatest punch, it’s time to research vendors. The most effective way to start is to ask for a referral from a trusted colleague. If you can’t get a referral (or even if you can), check out reviews online next. Start with the star ratings, but also read the comments.
If there are mostly four and five-star reviews, with only a couple of one-stars, you’ve probably found someone reputable. But read the comments to see if there are patterns (e.g. everyone raves about the product, but complains about the customer service). Consider what matters most to you when deciding who to call next. Wondering about our Google reviews? Check out all our five-star ratings & reviews here, and the announcement about our American Business “Stevie” Award win for Customer Service Success.
Check the Relational Fit
After making a shortlist of companies to evaluate, give each a call (yes, a call). Sure, you can email if you must, but remember it’s a lot harder to get a sense of personality and context through text alone. When you’re on the phone, ask questions like the following:
> How long have you been in business?
> Can you help me with such-and-such specific project/problem?
> What’s your availability like?
> How long do projects typically take?
> What’s your pricing?
> What are your payment terms?
The goal of the conversation is to get specific answers to your questions but, perhaps more importantly, gauge how you’re treated. Was the person enthusiastic and kind? Did they listen to your questions, or talk over you? Did they promise to send you something after the call – and then do it? This can give you a window into how the working relationship will be.
Consider End-to-End Pricing
Finally, let’s say you have three potential vendors that you like and have checked all your boxes. How do you choose between them? Well, what you don’t do is choose the cheapest option just because it’s the cheapest option. It isn’t always the best way to go and could end up costing you more in the long run.
Instead, think about value. Maybe one company is more expensive because they offer an incredibly thorough inspection before they begin their work. Yes, you might pay more in the near term, but this sort of conscientiousness might prevent much bigger, worse problems down the road.
Also, make sure you’re thinking through end-to-end costs. For example, some fabricators think they can save money by fabricating their own roof frames. But when they factor in all the costs like installation time, cost of labor, ability to remove and reposition if needed and so forth, it’s clear that QuickFrames roof frames are the most cost-effective option that delivers the most value.
As you go about starting vendor selection in metal fabrication and commercial construction, recognize that building a strong vendor network takes time and care. But when you look for a company that will act more like a partner than as a vendor, as we do, you’ll come out on top every time. Contact us to learn more.