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Relationships Over Everything: How to Strengthen Supplier Relationships

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​Relationships over everything... ​Specifically, relationships with your suppliers.

Why?


The two big reasons being they can give you special terms ​and​ actually send you orders!


In this episode of The eCommerce Lifestyle podcast, Anton shares more about the benefits of building deeper supplier relationships. Plus, you'll learn practical tips you can use to strengthen your existing supplier relationships. ​

Listen in to hear his ​​advice for better relationships in business.

If you liked today’s show, please subscribe on iTunes to The eCommerce Lifestyle Podcast! The podcast is also available on all major podcast players including, Stitcher and Spotify.


​Episode Highlights: 

  • ​TS 05:47 The three different tiers of suppliers.
  • ​TS 07:25 The benefit of deeper relationships with suppliers.
  • ​TS 13:53 How to strengthen relationships with your suppliers.
  • ​TS 21:48 Why customer relationships are just as important.
supplier relationship building

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Transcript

What's up, everybody? Anton Kraly here from eCommerceLifestyle.com, and you're listening to the eCommerce Lifestyle podcast. In today's episode, I want to talk about relationships, specifically relationships with your suppliers if you're dropshipping and using the Drop Ship Lifestyle model, so clear on that.

But before I get into this, and how to build these relationships, and why you should even care about them, I just want to give you a quick story of why I'm thinking about this. So last week on Monday, last week on Monday, I went to Starbucks in the morning, walked over there like I always do, and when I went there, my real estate broker was there. This is my real estate broker that sold me the home I'm in now. I gave a story about how I found him or how my wife found him and about how it was like this amazing experience. So if you didn't hear that, it's one of the episodes called New Money Machines. I think it's episode two or three. Just scroll back about a month or so in the podcast and you could find that. But, the point is had an amazing experience, over the top, just awesome all around, right?

So anyway, ran into him at Starbucks and he was like, "Oh, Anton how are things going? How are you liking the community?" And then he said, "Have you found an office yet?" Because when we were working with him in buying this home, I wanted an office space. We're building a new HQ here for all the companies. He showed me a couple of places. Nothing really was what I wanted back then. We were in the process of negotiating the house and all that, so I said, "You know what? Let's forget about this for now and we'll circle back to it."

So anyway, between then and between now, I've worked with different commercial brokers. I've seen some things, but nothing ever worked out, right? I even went as far as seeing one place that we loved, commercial space for our new HQ. I said, "Okay, this is perfect. Same day. I want it. Get me the contract, and I'll review it, and we'll be good to go." The contract never came, and eventually, it fell through because the company decided they didn't want to move out. So whatever. That's been going on for a while.

Anyway, see him again, didn't even think to reach out to him about the commercial side of things as an ongoing agent because he specializes in residential, but he asked ... I told him what's been going on, and he said, "You know what? I actually know somebody that I think has a space that would be perfect for you. Do you want me to connect you?" I said, "Yep, let's do it," Again, this is Monday.

A little bit later, maybe like 8:00 AM, so I'm super early, maybe like 8:00 AM 8:30, get an email from his assistant and CCed on that email are two people that own this building that's available that's five minutes away from where I live, and not on the market, not a public listing or anything. They say, "Hey, can you come by now?" I say, "Yeah, I'll be there in five minutes." Go there, check it out, love it. Say, "Okay, I want it." So that's the good news, right? Then say, "I want to do these renovations, take out this wall, add in a wall here, open the warehouse this way. Need this office to look like this." Whatever.

Went through a list of changes. They say, "Okay, great. We can do that. We'll get you a quote and a contract." I literally sent a quote over a few hours later. Sent the contract. I said, "This looks good. Let me review it with my lawyer." I went back later that afternoon to talk about a few bullets. By the time I went there, the walls were already starting to be knocked down because this company that owns the building also owns the construction company. So that's how fast things go when the relationships are right.

Basically, from Monday morning till Monday afternoon, through this connection, through this relationship that I had because I had an amazing experience when this guy sold me the house, we got a personalized connection. So now I trust the building owner a lot more than I would have if I just found them without any person that I knew in between us. They trusted me because I was talked about highly by the broker because we had a great relationship, like I said, when he sold us the house. And because of that, before I gave a deposit for any construction before I signed any contract, these guys were tearing walls down, starting to fit out the space that I wanted it done in.

Just to take this to Friday ... So that was on Monday. By Friday, last Friday, went back to walk through it. Literally, the place is almost done. There have been three guys working in there all week. Picked out paint colors and this place is going to be set up. We have a bunch of custom furniture and cabinets being ordered in, so within a few weeks because that's all custom built.

But the point of the story is when you have good relationships, things move fast. You get preferential treatment. These people didn't need any other references for me. They didn't need years of bank statements. Of course, I'd be fine providing that. But because it's built on a relationship, things just move. The search that I've been on for months now trying to find a perfect place, because of a relationship, literally in one day everything was just wrapped up. So yeah, that's, again, what got me thinking about this.

But how does that affect you? I'm sure you could tie it to your business, how you should treat customers and have the best relationships you can with them because it's going to lead to more referrals, more business, and, yeah, just literally your business lasting and growing. But as far as relationships with customers go, that's a topic for another day. If you want to get more into that and you're part of Drop Ship Lifestyle, just dive deep into module four in there because that's where I go deep into building relationships, strengthening them, and everything about that.

And if you're not, by the way, if you're not part of Drop Ship Lifestyle, go to ClosingDSL.com, ClosingDSL.com, because we are closing two new enrollments on Tuesday, October 29th. This is Monday the 28th. So if you're listening to this, when it comes out, you're not a member yet, you have less than ... What is it? Less than 48 hours, probably closer to 24. So, ClosingDSL.com.

All right, but let's get back to your relationships and your relationships with suppliers if you're using the Drop Ship Lifestyle business model. So if I keep looking down, it's because I made notes. Don't want to miss anything. But you probably are aware already, or if you're not, again, a member, you're not aware, but we break suppliers down into three different tiers. We have bronze, we have silver, and we have gold. Bronze you don't want to work with. Silver will make up most of your suppliers. And gold is the winners. You want as many of them as you can possibly get.

And if you're part of Drop Ship Lifestyle, and you've gone through the approval process with the gold suppliers, and you've used our scripts, and you've done what I teach you to do, then you know how much work goes into getting approved.

That's a good thing, right? It separates you from everybody else. But the problem is, what a lot of people do is they get that relationship in place, they get approved to become an authorized retailer, and then they kind of just let it die. You send your orders in when orders come, but there's nothing really extra. That's just it.

The way I can compare this and why you shouldn't do it is picture you just ... You had this guy or this girl in your life that was a 10 in your eyes, right? Personality, looks, everything. And you finally got a date with him, right? You did everything right. You got a date. You went out. It was amazing. And then after that, all you did was send them a text once a week and just said, "Hey, how's it going?" Right?

Well, you're not going to get married that way, right? And this great thing isn't going to become anything because you did the work to get that date and then you just kind of let it fade away. That's the same thing that could happen if you get approved with one of these top tier suppliers and then just every once in a while an order comes in, you send it their way, okay, cool. Nothing's going to build from there, so don't do that. You wouldn't do it in a relationship if you were serious about the person, and you definitely shouldn't do it in your business if you're serious about making money and just growing your business the easiest way possible.

Some of the benefits of why you should work on building your relationships out and work on strengthening them, one most obvious is pricing. The more volume you do with a company, and the more they trust you, and the better relationship, really, that's the best way to say it, the better relationship you have with them, the more open they're going to be to giving you better pricing. That might mean 10% off all purchase orders. That might just mean whole new price lists opens up for you. That might mean around the holidays you get a better price so you could push their products.

All these things are very common, but they're not common for the retailer that they barely hear from and is just on their list of other retailers. They're common for companies that have the strongest relationships. Pricing, obviously it's huge, means more money staying in your pocket, so that's a reason enough, right?

Another benefit is shipping speed. So when you first get approved with any supplier, kind of everything is generic. It's stock. It's the same for me as it is for you as it is for the other person that got approved a month ago. But as you, again, have a better relationship, you can start asking for more things. Sometimes they'll just say, "Hey, we have this option," or sometimes you can ask and there'll be more likely to say yes. So if they normally ship orders the next business day by 5:00 PM, maybe you can get it so that orders's placed before noon ship the same day. You're getting that priority treatment. You're getting bumped up on the list. Your orders are dispatched faster. That's not uncommon at all.

Another thing that I talk about in Drop Ship Lifestyle is offering customers extended warranties. Now, as I talk about, we're not offering these warranties ourselves, we're doing it with our suppliers. But if you want to have that conversation with a supplier, there needs to be a relationship in place, so you need to build it out before you just say, "Hey, can we offer a two-year extended warranty when everybody else is offering one?" It's not going to happen by magic. It's going to happen because you have a relationship.

Another huge one is the inventory. At the time I'm recording this, we're moving into the busiest two months of the year for eCommerce and retail in general for Black Friday, Cyber Monday, leading up to Christmas, New Year's, all that fun stuff. But what happens with certain suppliers is it's not just busy for us, it's busy for everyone, and their inventory might start to drop, especially if they're a newer supplier and they don't have this experience of how much is going to move. What that might mean is you basically sell out of their inventory by two weeks into November. Now the busiest shopping season's coming up and there's nothing left or they have five units left where you could sell 20, or 30, or 40 but now you can't because they don't have it.

So when you have a stronger relationship, you can have inventory held for you. So if supplier A has 50 units left of a bestselling product and me and you are both trying to sell them, I could say, if I have a better relationship, to my rep, "Listen, you know we're going to sell these. I want to hold these for our company. Can I give you a deposit? Can you just put them with our company name on it and just make sure they're reserved for us?" Again, those things will not happen if you don't have a deep, strong relationship. So build those relationships, then you can start asking for things like that and not just asking but getting them.

Another benefit of building a relationship with a great supplier is the opportunity to have products private-labeled. So let's just say you're selling stand up paddleboards and you want to make it called Anton's Paddleboard. If the company has no idea who you are, if there's no trust, if there's no relationship and you just say, "Hey, can you just start printing Anton's Paddle Board on these?" they're probably going to say, "No. Who are you?" But if you have a relationship, you're building it, they trust you, you trust them, they see that it's worthwhile, then you have that opportunity for them to start, again, being more open to ideas that will help both of you grow your businesses together.

Another one, returns policy. Let's just say, again, we get, we both get approved for supplier A. Supplier A has a 30-day money-back guarantee policy, so that's what we offer our customers. Then we have a customer that emails us on day 32 and they're like, "Hey, I missed the window. I really just wanted to return this. I totally forgot." Whatever. It happens.

If you have a relationship with your supplier ... And this doesn't happen every day. I'm not saying you should always try to bend the rules. But if you have that relationship, sometimes your supplier will say, "Okay, I know we're two days outside the window, but we'll take that." Then you can offer it to your customers. It's no loss to you. And because of that relationship, you now have a happier customer that's not going to have a bad experience. It doesn't always work, but it's something that becomes an option when your relationship is stronger.

Another thing... Again, if you're a part of Drop Ship Lifestyle, you know why we do this, why we do everything I'm talking about here plus a lot more to build relationships. It's because the top tier suppliers will actually send you orders. The reason that this just came up and the reason I wanted to talk about this as well is that in our private Facebook group for members of Drop Ship Lifestyle, one of our coaches, Brian, he just posted a screenshot where it was Friday of last week. One of his suppliers sent him ... Well, they sent him a customer that placed an $88,000 order, one order for $88,000. It's not for one product, obviously. They're buying a whole bunch of them, more of a B2B sale. But that would never happen, okay? That would never happen if he didn't have a relationship.

Let's just say, again, Brian got approved for that supplier and so did three other people? If the other people were working actively on building their relationship and Brian just was there kind of on the sideline, well then one of the other companies would have got referred that order. And if you're wondering like, "Well, why would the supplier refer that order to begin with? Why wouldn't they just keep it themselves?" I talk about this a lot in Drop Ship Lifestyle, again, in our coaching program. But the reason is their business is in B2C. They don't want to be the retail side. They focus on making great products. Then they work with retailers, like us and like Brian, to sell for them, to take care of customers, to do the marketing, and that's why these relationships work so well.

But again, whether it's an $88,000 order like they sent Brian, or whether it's a $2,000 order, they're free. It's free money. They're getting sent to you. And they're only getting sent to you, not just if you're approved, but if you build this relationship with them and if they have a reason to trust you enough to give you that responsibility of that order. So another massive reason.

Those are some of the benefits of building these relationships. I just want to go over a few quick points on how to strengthen them. So let's just say you already are an authorized retailer for some great brands and you want these deeper relationships so that you can get all of these benefits. This, again, it's covered in detail in module four where I give you everything laid out of Drop Ship Lifestyle. Just go to ClosingDSL.com.

But let's just talk about how you could do this, just some easy quick wins, right? What you want to think about is, what do suppliers actually want? To think about what you can do to build these relationships, just kind of flip it and think what they're looking for in relationships on their end. The first thing is trust. They need to trust you. Again, if they're going to send you huge order, if they're going to give you better pricing, if they're going to hold inventory in their warehouse for you while they're telling other people, "Hey, we don't have any left," they need to trust you 110%.

The easiest way you can build trust is just through open communication, and this happens over time. It's not from day one. But just don't hide things. Don't change the story. Don't let anything get into a gray area. Just be honest and upfront with them about everything from all of your orders to any complaints to any other people violating map that you're reporting to any good experiences you have to anything you have questions on. The trust needs to be there. And if they trust you then ... I mean, if they don't trust you, you're never going to get anything special from them. So just constantly make sure you're honest and open with them at all times.

This second one kind of plays into that, but it's reliability. Listen, again, if they're going to be open and giving you special treatment because that's really what we're trying to get here, we're trying to get special treatment, if they're going to do that, then they need to be able to rely on you. And the easiest way for them to know they can is by having you always be there and not disappear. So if anything ever happens where they're trying to get a hold of you or your company, if you've ever had anything special from them in the past, like offered, and then you kind of disappear and the conversation dies out and they can't get a hold of you, or there's a problem and you're not there to help resolve it, they're not going to be able to rely on you.

And again, if somebody is going to be willing to say, "Hey, you're going to get 10% off all of your orders," or, "Hey, we're going to private label our products for your brand," or, "Hey, we're going to send you this free business," if they can't trust and know that you're going to be there reliably, it's not coming your way because it's just it's too much risk on their end. That's really what they want. They want as the biggest results that they can get with as least risk that they can be exposed to. So trust, reliability.

Another one, obviously, what do they want is sales. I'll tell you, they don't want sales that come without trust, so that's first. But as far as sales go, obviously you're bringing them consistent orders, and something that they really like is when you're doing it in unique ways. Obviously, go through all of our traffic training in Drop Ship Lifestyle. You'll be using Google Ads. You'll be using YouTube, Pinterest, Twitter, Facebook, Instagram, emails. You'll be doing all that. But anything that you can do to kind of go above and beyond or something a little bit different that actually gets them results, they'll love that because now that's something that they know, hey, Anton has this or you have this, and that will help in the long run as well. So don't just be another random retailer for them.

This one's huge, respect, okay? I don't have a problem with this because I'm like the most laid-back person in the world. I can get pissed if things don't happen right, but I'm more of a personality type that when things go wrong I'm looking for solutions in as calm way as I can. But I don't blow up on people. I know a lot of people, especially stronger ... I don't even know what to call it. They think they're stronger personality types. I don't think it is. But when they get mad, they think they have to talk down to people. They think they have to raise their and scream, and that's going to get you nowhere fast.

Let's just say your supplier, and like a good supplier, let's just say they totally dropped the ball on an order. Let's say they ship it. It was a time-sensitive order that had to get to Manhattan for an event, and instead, they shipped it to California, and now it's never going to get there, right? That sucks. There's no two ways about that. You're going to lose money. You're going to have a pissed off customer. It's just not fun, right?

But if the way you handle that is by calling your sales rep and freaking out, and screaming at them, and cursing, and talking down to them, well, guess what? They already know they messed up, and next time when you need something they're not going to be as helpful and they're not going to be as responsive. And when you want special treatment, it's probably not coming your way.

There are ways to talk to people with respect. There are ways to let people know when they messed up and what it actually meant to you but respect them. Don't lose your temper. It's never ever, ever going to help you. Whether it's with a supplier, a customer, a vendor, whatever, just don't do that. It's not strength. It's really a weakness, and you'll lose their respect as soon as you do that.

Another thing that they love is a collaboration, okay? So what can you do with them? And this is like the relationships are usually built it goes both ways. So what can you do where you're actively working with them and they're actively working with you? I talked about this in an episode, maybe last month, about different ways that you can go to their different events, whether that be trade shows, time to set up to go visit their offices and warehouses where you can make content. It could even be things like you're just asking them for quotes for your website where you're writing blog posts about their company and you're asking for their input.

But, be collaborative, right? When you're making content for their brand. Don't just do it on your website and hope they see it. Do it with them. Again, it might seem like you're giving them work, but they're going to like it because in the long run it's going to lead to both brands being stronger, and it's going to lead to more trust and a deeper relationship with them. So definitely collaborate whenever possible.

Then another thing that I've always been big on is just showing appreciation. You don't have to be over the top about this. But if you know something is happening, like if you have a close relationship already with your sales rep at a supplier and you know that they're taking off because they're having a baby, like they're going on maternity leave or they just came back, send them something, right? It could be just an email or ask them for their address or send it to their office if they work out of the office. Just send them a card. Send them something for a baby, right? If you know that they just got a promotion because they told you, just be ... Tell them like, "This is amazing. Good for you." You want to, again, be building up the relationship. Talk them up when you should.

Another huge thing that we always do is around the holidays is we do send actual gifts. It's not for every supplier. Let's say we have 20 suppliers and 10 of them are just like we have average relationships with. We will send them cards and just say, "Happy holidays. Wish you and your family all the best." But then as our suppliers and the relationships, and the sales are bigger and bigger, we send different things. It could be a box of chocolate. It could be a bottle of wine with a note, again, just thanking them for their help over the year and just letting them know how we look forward to building the relationship over the years.

Do things like that. I'm telling you, most people will never do this. It goes a long way. And when you do these things, it doesn't happen overnight, but over time you're going to have these better relationships. You're going to have all the benefits that I talked about before. So yeah, go back. Listen to this episode as many times as you need to. Again, if you're a member of Drop Ship Lifestyle, just dive into the Drop Ship Blueprint. Go through all of the training in a big way where I talk about how to get suppliers, how we follow up with them, what we do after we're approved because that gets a lot deeper into this. But this is only going to help you, and it's really important for the long-term health of your business. Literally, it's just extra money we're talking about here and it's just being a good person, too, so do it.

We should also mention that customer relationships are just as important as how we build out the supplier relationships. But again, that's for another episode. This one's already way over how long we always go. But as always, I do hope you found this helpful. Quick reminder, if you're not part of Drop Ship Lifestyle yet, go to ClosingDSL.com right now because we're closing at midnight on October 29th, ClosingDSL.com. So that's it, everybody. Appreciate you. And I'll talk to you in the next episode of eCommerce Lifestyle. See ya.

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