Today, we continue our series on negotiating terms with your wholesale suppliers. In previous posts, we’ve covered being prepared, knowing the payoff, asking for better terms, flaunting your potential and being realistic in your expectations. Here are some more things to keep in mind during the negotiation process:
Be Aware of Alternatives
Switching wholesale suppliers is a hassle, to be sure. Using your existing supplier is comfortable, and finding a new supplier can be a real pain. Once you’ve found a new supplier, you still have that initial period where you aren’t entirely sure of their product or service, and you have to constantly watch to see how they’ll perform.
Still, sometimes it needs to happen. You need to be aware of your supplier’s competition. Check a dropship wholesale supplier directory, and maybe even contact some other suppliers just to open the lines of communication. If you threaten to leave your current supplier during the negotiation process, be prepared to follow through and do it.
Knowing the competition also offers you another advantage. You can drop the name of other suppliers right into the conversation with your supplier. Know what the competition offers in terms of price or other terms, and then ask your current supplier if they’re willing to meet the same conditions.
Price Isn’t the Only Consideration
There are things other than price that can matter to you. Before you even begin talking about price, find out what else the supplier can do for you. Perhaps your wholesale supplier can offer you expedited shipping or processing at a discount rate, or maybe you can even negotiate extended payment terms.
There may be other benefits a supplier can offer, as well. Maybe they can help you add value for your customers. Perhaps they can give you an extended warranty to your customers, or even put up a prize for a competition or a bonus for a certain sales volume. Explore all of these kinds of options before you talk price.
Consider Pooling
Don’t try to negotiate terms with your wholesale supplier based just on your own sales volume for a single month. See if you can pool requirements on a quarterly basis, or on the basis of your annual purchases.
You might also consider pooling with other retailers. If you have a colleague in a similar niche, see if they would be willing to go in with you to help get a better price for the both of you.
Next time, we’ll take a final look at negotiating terms with your wholesale suppliers.
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