Working with a trusted supplier has many benefits for you as a business owner, but even though you may have already established a good relationship, have you ever thought of renegotiating your prices? This can be a tough thing to do for many people, but keeping your costs down is always going to be the best way to improve your bottom line. In order to get the most out of renegotiation, you need to go in prepared. These tips will help give you the best hand and make it easier for you to score lower prices!
Be Transparent With Your Projections
All suppliers love repeat customers and if you’re able to prove to them that you’ll be around for the long haul, they’ll be much more likely to be open to price discussions. Pull out your past order sheets and let them see the total you’ve ordered up until now and if you can, provide future projections of how much you expect to be ordering in the future based on research. You’re both in business to make money, so show them how much business they’re getting from you!
Increase Your Deposits
Just like any other business, having positive accounts receivables will benefit them. By offering up larger upfront deposits on orders, your supplier will be more open to negotiating pricing with you. You shouldn’t be scared to offer 50% or even 60% upfront if you have a good relationship with your supplier.
Do Your Research
Many suppliers have discounts available all the time in order to secure new business, but these discounts may not necessarily be available to you, an existing customer. If you want to come to the table with something to bargain with, you need to be scanning their shops and products daily and get a weekly list of their advertised prices. If you find that their advertised price is lower than what they’re selling to you, you have something to bargain with and will be able to bring down your prices.
Sure, you can hire someone to manually check the prices every day, but that’ll quickly add up in costs (something you’re looking to avoid). Working with a company Like Industry Compete will ensure you’re getting all the data and analysis you need to get a positive outcome at negotiating your pricing! Get your quote today.
Extend Your Contract
Just like a bank loan, extending your contract with a supplier can often secure you lower interest rates and lower costs. Before you consider this option though, it’s very important to consult with your accountant to make sure the extra interest and increased smaller payments over the long term make sense in relation to your ROI.
Be A Good Business Partner
If you’re a problem customer, the chances of you getting the best deal are slim to none. It doesn’t matter if you’re offering to throw money at a supplier, if you’re not courteous, don’t pay your bills on time, don’t stay in regular contact, and treat the supplier as less than equal, you’re not setting yourself up for a good outcome. Instead, foster a good relationship and only then once there is a mutual trust instilled between you, go to the bargaining table with full confidence in yourself and your business.
To sum it up…
As you can see there are many ways to get the best deal out of your supplier. More than not, it all comes down to you doing your research and stacking the odds in your favour. As a business owner, you should always be on the lookout for ways to cut your costs and grow your business. Automating is one of the most effective ways to do this. Ask how Indusry Compete can help automate your research process and help you go into supplier negotiations with full confidence!