Buyers find that identifying the right supplier may be difficult, and a large number of procurement teams consider this the most challenging component of their job. Choosing the correct supplier ensures that the products and services are supplied on time, at a suitable price, and according to company standards. But how do procurement teams choose suppliers in the first place?
Procurement teams generally don’t randomly seek out suppliers; the supplier selection process starts once the procurement team has identified a specific need for new suppliers.
When looking for new suppliers, most companies follow a very specific process that’s known as a vendor selection and review process. Getting through this process is how your company gets selected as a supplier. While there are specific aspects of supplier selection and review that will vary from buyer to buyer, there are areas that buyers universally review to ensure that a supplier is going to be a great fit.
Here are seven tips to help you appeal to more buyers:
Price is a critical factor that buyers consider when looking for new suppliers. However, buyers don’t merely pick a supplier based on their price alone, especially if the purchase is non-commodity items. When it comes to general costs, low-cost products and services may not be the best choice, as low cost may be indicative of low-quality. While your pricing should be competitive, your company needs to earn a sufficient profit at the specified price for your company to remain in business. Smart buyers are aware of this too, and aren’t likely to choose a supplier who could price themselves out of the market.
2. Understand Your Brand Perception
Being the best and easiest choice for a buyer means that your company doesn’t pose any undue risk to a buyer. Part of any vendor selection process involves due diligence on the part of the buyer. In a digital world, information about your company is more accessible than ever. Your company’s website is often the first place a prospective buyer will go for information about your company, so ensuring your website is up to date is critically important.
Information regarding your company’s service record, legal and financial history, credit history, and regulatory, financial, and legal compliance is of the utmost importance to a buyer when looking for new suppliers. You can bet that any potential buyer is going to assess this information as part of their supplier selection process.
Being aware of any potentially negative information or perceptions about your company allows you to fix issues before potential buyers become aware of them. Due diligence is important for your company too, and being on top of reputational, legal, financial, and compliance issues ensures that you’re always putting your best foot forward.
3. Show What You Do Best
Now that everything is online, we all have to find substitutes for walking through the store and picking up the products on display. Buyers are people too, and evidence like images, video clips, or detailed information of the facility, products, or services offered can go a long way to help you get into the “in” column. Competition is often fierce, so you should be taking every opportunity to show off where your company excels.
4. Be an Easy Choice
Your company needs to represent a safe, best value choice for your prospective customer. Whatever you can present that signals your solid reputation (like reviews), your track record (like references), and your stability (like certifications) will indicate that you’re an easy choice compared to a competitor.
For example, if you know your buyers are specifically looking for a certain type of supplier with a certain type of certification, get that certification! Lots of organizations have initiatives regarding supplier diversity and sustainability. If your company is diversely owned, local to a buyer, or a small business, have the certification necessary to back up that claim. You’ll be a much more attractive supplier for potential buyers in the long-run.
If you have a unique product or service but are new to the market, reduce your perceived risk by issuing warranties with your product or offering free trials. This can be a risk, so be sure your product or service is worth it. Most buyers will be looking for a way to avoid making a risky choice with no backup.
5. Nothing Beats a Good Reputation
One of the ways your prospective customer will make a final judgment is to seek recommendations and reassurance from your previous customers. If you are on one of the leading marketplaces, such as Amazon, buyers will check the reviews directly from your sales page. If you are listed in business sites like SupplierGATEWAY, your clients can leave reviews and ratings that are reflected on your profile. Follow up and communicate with your customers— make sure they are happy with your product or service. Your next sale may depend on it.
6. Be Prepared to Go Big
If you’re good at what you do—and we are sure you are— you should already be thinking about how to manage success and growth. If you discover that your customers are demanding massive shipments of your goods over time, orders may soon exceed your capacity. Most buyers are very unforgiving regarding late or missed deliveries. Talk to your key customers and work closely with them; they are vested in your overall success too.
7. Get to Know Your Potential Buyers
In the past, it was commonplace for customers to visit you and tour your company and its facilities. Today, a large global commerce footprint, inflation, and the overall impact of the pandemic has made in-person meetings and facility tours less frequent.
The good news is technology has made it possible to reduce some logistical costs and challenges while preserving the due diligence buyers require. Use virtual meetings, media and digital tools to your advantage to make more meaningful connections and lasting impressions at a lower cost and in less time.