Suppliers need to evolve to succeed

2 August 2013
A vital part of a successful supplier’s ethos is recognising the industries where demand for an offering is growing and acting upon this insight. But increasing cost and time related pressures on businesses mean providers have to incorporate multiple offerings into one and have the ability to adjust to the needs of customers quickly. Distinguishing wider market shifts, as well as changes in business buying behaviour amongst customer groups is vital to the survival of even the largest multi-category supplier. Static, long-established supplier business models that fail to fit around the changing needs of their customers simply don’t cut it. At the moment there is more pressure than ever before for businesses to drive cost out of the supply chain. This should be seen as an opportunity. By focusing on sourcing and providing supplies and services that can deliver maximum value over the life of a contract, contractors can clearly demonstrate their ability to deliver in line with customer needs. For some time there has been a widespread need for providers to offer consolidated business solutions, instead of single categories like general office supplies. But taking this approach to a new customer base requires the ability to react quickly to growing sectors, such as utilities and construction, where large corporates are rapidly expanding through mergers and takeovers. For suppliers, there is an opportunity to establish or affirm their role as partner to businesses that have rapidly expanded and require assistance in restructuring and centralising their ordering processes. Recognising and reacting to the challenges businesses face is part and parcel of a successful supplier-customer relationship. Whether these are operational or environmental, suppliers must proactively find ways to drive extra efficiencies to demonstrate value. This may involve consolidating deliveries to reduce a customer’s accrued carbon footprint, or providing consultation around simplifying the ordering process or helping businesses reduce their supplier base. But it is important for suppliers to remember it can take time for customers to streamline their ordering processes and structure internally. Suppliers should work closely with customers to help them achieve these cultural changes, being sure to have flexible contingency plans in place for the way the relationship is managed in the meantime. Forecasting demand is a vital part of any supplier’s outlook, but it is also important to identify those sectors and businesses that need to optimise their supply chain efforts. Those that concentrate on driving value out of as wide a range of products and services as possible can much more readily adjust and cross-sell in a way that demonstrates clear value and retains customers in the process. ☛ David Farooqui is director of business services division and new business at Office Depot UK & Ireland
Darmstadt-Dieburg, Hessen (DE)
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