Be a Big Fish in a Small Pond with Vendors

One of the issues you face is dealing directly with vendors. You often donโ€™t have the capital to strike normal compensation relationships with vendors. You also canโ€™t promise volume or make longer term commitments because you donโ€™t know. Despite these risks, these vendors can be critical to your business success.
How do you give yourself the best chance for success with vendors? I learned the answer from my brother. My brother runs our familyโ€™s real estate business in which he manages about twenty buildings. Instead of working with the largest elevator companies, insurance brokerages,ย contracting companies and other vendors, he works with vendors that consider our business meaningful to them. If you provide a vendor with $1 million in business and their revenue is $10 million, you matter. If you provide a vendor with $1 million in business and their revenue is $100 million, you are a rounding error. While working with the largest vendors can add credibility, you may end up being a small fish in a big pond.

“We WILL be there with you every step of the way.”ย 

Smaller vendors are also more likely to price their services based on the potential of your business as opposed to the business at hand. If a $10 million vendor will win $250,000 of your business now, but your business with them might expand to $1 million, they may see the opportunity and provide the $250,000 for $150,000. Larger vendors usually look only at the business currently in front of them and price accordingly. This doesnโ€™t only relate to price. It can also impact the resources committed to your business. When my brotherโ€™s team calls the elevator vendor, they donโ€™t get the young buck out of elevator school. They get the President of the company.

These concepts are not new. They are employed by companies all the time. We all understand โ€œbig fish in a small pond.โ€ However, when you are a young organization looking for credibility, you often try to align yourself with large, established vendors. Vendors are key to riding the wave of growth and progress. Make sure they wake up thinking about your business.

Follow Us on Social Media

Where do you go for answers?

LEARN MORE

Our Learning Community is the one stop shop for the intelligence you need. Instead of countless hours searching for answers, we’ve organized what you need to know across all of the business and personal issues you face. You’ll get knowledge, ongoing support, weekly live coaching sessions, tools and templates, vendor reviews and a vibrant community of your fellow entrepreneurs. All that for only $99/month! Join today!

Share The Lonely Entrepreneur