Written by: Paula Woodhouse, VP Head of Business Banking, Union Savings Bank
Running your small business is like operating a well-oiled machine. There are lots of moving parts, and each part has a specific job to do to keep the machine moving full steam ahead. In the case of your business, these parts likely include your employees, your products and services, and your small business vendors. Depending on the size of your business and what industry you’re in, your vendors may fill a wide range of roles that you rely on for your day-to-day operations. That’s why finding small business vendors you can trust and managing them effectively is paramount to your business’ success. Here are 8 tips for finding and managing your small business vendors.
Look for small business vendors that specialize in your industry.
Every industry and market has their own nuances which can pose serious challenges to vendors that are unfamiliar with them. This can lead to mismanaged resources and unclear communication, two enemies of effective vendor management. No one knows your small business better than you do, but if you search for vendors that specialize in your industry, they can come in a close second.
Make an honest list of your needs and expectations.
Even vendors that specialize in your small business’ industry and local market are not mind readers. You have your own needs and expectations that your small business vendors will help you meet, so as you continue on your search, keep a list of requirements that you will eventually share with your top picks. These expectations should also include turnaround time, not just cost and supply. For example, if your business sells customizable products, you’ll need to be honest with the vendors you evaluate about how quickly you need orders prepared. Being afraid to scare off potential vendors with what you might consider to be a demanding timeline will only cost you (and your vendor) in the long run.
Read reviews during the vendor evaluation process.
Once you have selected several potential vendors, start combing through online reviews to learn what other small business owners have to say before sending out your RFPs. Online reviews can tell you a lot about how vendors work with their small business clients and the quality of their working relationships. If online reviews aren’t readily available, consider requesting a list of the vendor’s current customers whom you can contact. Keep in mind that vendors will likely only share their happy customers, but this inside look can still give you some insight as you perform your vendor evaluation.
Build mutually beneficial relationships with your vendors.
Once you have made your final selection and ironed out all the details, you and your vendors can get to work. Both you and your small business vendors know that ultimately you are the client and they are the service providers, but that doesn’t mean that your relationships are all one-way streets. Taking the time to understand how your vendors operate can contribute to your mutual success. For example, being mindful of your vendors’ schedules, sending files in their preferred formats and giving sufficient lead time can help maintain positive working relationships, which will motivate your vendors to keep doing their best work for you.
Keep your lines of communication open.
As with any relationship, communication is the key to successful vendor management. Especially at the beginning of your working relationship, it takes a lot of discussion to get your team and your vendors on the same page. Often times, this open line of communication starts to dwindle after several months or years of working together, but it’s important to keep conversations going so things continue moving smoothly. Consider establishing weekly, monthly or quarterly phone calls to discuss status and any upcoming changes or large projects. Your vendors might even need their own backup if they see a particularly large job coming down the pike. Open communication ensures that both parties stay informed and satisfied with the workflow.
Don’t be afraid to take advice from your small business vendors.
If you have selected a vendor that operates within your industry, chances are they have seen things done in a multitude of different ways with varying levels of success. Don’t be afraid to let your trusted vendors in on some of your ideas and strategies and listen to their advice. Sometimes bouncing ideas off of someone outside of your own team but within your specific industry can help you discover new innovative ways to grow your small business.
Let your vendors do their jobs.
Relinquishing control as a small business owner can be hard, especially if you are new to hiring small business vendors. Your entrepreneurial spirit is what got you to where you are, but you don’t have to go it alone. Your vendors are experts in their craft, so letting up on the reigns and allowing them to do what they do best will not only help your business, it will also help you achieve a healthier work-life balance.
Hold your small business bank to the same standards.
Juggling cash flow coming in from your customers and going out to your vendors can be a lot to handle. Just as you selected your small business vendors based on their expertise and flexibility, make sure you evaluate your small business bank the same way. Look for a bank that can offer customized solutions that work for you along with advice and market intelligence to help you make informed decisions.
Searching for and managing small business vendors effectively can help take some of the pressure off running your small business and can also add a fresh perspective to your business strategy. Be selective about choosing the right vendors for your small business. If you’re ready to work with a local bank for your small business banking needs, we’re here to help. Contact us today.