Partnering Can Provide Mutual Benefits
Partnering as I choose to define it refers to the process of getting together with certain vendors to work out mutually beneficial arrangements to help both you as the contractor as well as the vendor.
For example, you may agree to buy a percentage of your purchases of certain items from that company in return for some special delivery arrangements. I'm involved in an ACCA MIX Group, and one of our members, who does custom home and apartment work, has an arrangement with his major supplier wherein the contractor purchases all the items he regularly uses on a residential new construction job or project from that vendor.
In return, the vendor delivers all of the equipment and materials directly to the job. The contractor literally has no inventory. This is an extreme example, but it gives an idea as to how partnering can work.
The initial commitment to partnering, which must come from you, the contractor, is the fact that you must realize that your partner may not always have the very lowest price on all of the items you are buying from him.
You have to be satisfied in your mind that although you may be paying a few cents or dollars more for some items from this partner, the overall benefits of dealing with one vendor over several more than make up for those differences. Some of the benefits you can obtain from being a partner include special delivery arrangements, added advertising and/or other promotional benefits.
Chose companies with whom to partner that share the same business philosophy that you do. Hopefully that philosophy is to do whatever it takes to satisfy your customer. For example, last year, one very hot Saturday, we had a customer that wanted to purchase a new, upgraded air conditioning unit - that day! It happened to be a unit we didn't have in stock.
Our service manager contacted our equipment vendor's salesperson and asked if they could make arrangements for us to pick up one of these special condensing units right away. Even though the vendor was not actually open on Saturday, the salesperson arranged for someone to meet us at the warehouse.
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The Human Touch
Partnering emphasizes another important fact. That is, people still prefer to do business with people. Despite all of the technological advances that we have available to us, when we need something, we like to talk to a person. Partnering just takes the process a little further and says that we want to do business with you and we are willing to do some things that will hopefully allow you to be more profitable in dealing with us. In return, you will do some things to help us.If availability of product becomes a major issue, those most likely to receive product from their vendors are those who have worked closely with that vendor as a partner.
Even if availability doesn't become an issue, having a vendor that will keep you informed regarding the
status of pricing, availability, etc., could be invaluable in helping you to remain profitable.
The idea of partnering in our industry has been around for quite a while, but it has never been more important than it is now. Try it - you'll like it.
Guest columnist Butch Welsch operates Welsch Heating & Cooling in St. Louis. He can be reached by e-mail at Welsch1@primary.net.
Publication date: 05/10/2004