INDUSTRIAL DISTRIBUTION: HOW TO AVOID COMMUNICATION ISSUES AND MISUNDERSTANDINGS IN THE SUPPLIER/DISTRIBUTOR RELATIONSHIP
Clear communication between distributors and suppliers is a must in the distribution industry, but often, that is easier said than done. Take a look at this common scenario on Industrial Distribution’s website and learn how to avoid damaging misunderstandings.
Industrial Distribution Excerpt:
Communication is a must, but suppliers and distributors are often reluctant to share strategies. Why? For one, suppliers feel it is too risky to share strategic direction, for the obvious reason that to broadcast it may result in unintended tips to the competition. Managers tend to find it embarrassing-not to mention the potential for revenue loss-if the competition responds to their initiatives before they are implemented. “Foul,” you say. Maybe. Good supplier-distributor relationships dictate an open line of communication, especially if there is a significant directional change. Whether or not suppliers share information depends on a number of factors, including your relationship, trust, professionalism, contractual obligations and other agreements. Trusting that you will get the complete picture is too important to leave to chance.
Suppliers are generally trustworthy, although at times they may not seem so. Friction between suppliers and distributors is often caused by a different reaction to, or perception of, business pressure. If “all politics is local” then “all business is personal.” The dynamic of selling and buying is a personal relationship based on the potential for mutual benefit. The breakdown is generally driven by external forces-perceived or real-and how companies respond to the threat. Having realistic expectations based on the external environment, trends, supplier strategy or a combination of all three is a must for good business relationships. Understanding your suppliers’ motivation will create a broader decision base and prevent a surprise that may have serious ramifications.