Suppliers Are More Important Than Customers

Read Time: 4-minutes

This is something I’ve said many times, and something I truly believe in. To put it crudely, lose one customer, you’ve lost one customer. Lose a supplier, you’ve lost all your customers too…

Naturally it’s not as simple as that, it never is, so I’m going to explain in much more detail why having reliable suppliers is more important than just focusing on your customers.

I’ll show you how the right supplier relationships can help your business grow and prevent common problems many businesses face in the chemical supply chain.

As a buyer of chemical raw materials and ingredients, it’s easy to think that customers are the most important part of your business. After all, they are the ones buying your products, right?

But the truth is, your ability to meet their demands depends heavily on your suppliers.

If your suppliers aren’t reliable or can’t deliver on time, it won’t matter how many customers you have. Focusing on strong supplier relationships will keep your business running smoothly, reduce risks, and give you a competitive edge.

Many companies make the mistake of putting all their energy into customer relationships, overlooking their suppliers. They assume suppliers are just there to provide materials, but they don’t treat them as important partners in their success. This results in last-minute shortages, delays, or poor-quality products, which ultimately hurt your relationship with customers. The key is to create strong partnerships with suppliers that benefit both sides.

Takeaways:

1. The role of suppliers

2. The bottom line impacts

3. Common mistakes

4. Steps to improve relationships

5. The long-term benefits

"In the long history of humankind, those who learned to collaborate most effectively have prevailed." – Charles Darwin

The Role of Suppliers

Suppliers play a crucial role in the success of your business. They are the ones who ensure you have the materials you need to produce and deliver your products. Without reliable suppliers, you risk delays, production stoppages, and a loss of trust with your customers.

A good supplier can help you respond quickly to market demands, provide insights into new products, and even give you better pricing over time. In short, a strong supplier is an extension of your own business and should be treated with the same importance.

Impact to the Bottom Line

Strong supplier relationships directly impact your bottom line. When suppliers trust you, they’re more likely to prioritise your orders during high demand, offer you competitive prices, and alert you to potential problems before they affect your production.

Additionally, a reliable supply chain minimises waste, reduces lead times, and keeps your operations efficient. Focusing on suppliers helps you manage costs more effectively and avoid expensive downtime or quality issues that hurt your profits.

Common Mistakes Buyers Make with Suppliers

Many buyers assume that suppliers are just there to fulfil orders and don’t see the value in nurturing the relationship. Some common mistakes include only communicating when there’s a problem, treating suppliers like they’re easily replaceable, and ignoring the value of collaboration.

These approaches can lead to frustration, miscommunication, and, ultimately, unreliable service. A reactive approach to managing suppliers can end up costing you time and money…

Steps to Improve Supplier Relationships

1. Communicate Regularly: Don’t wait until there’s a problem. Regular updates and feedback help build trust and ensure both parties are on the same page.

2. Be Transparent: Share your forecasts, challenges, and opportunities with suppliers. Transparency helps them plan and meet your needs more effectively.

3. Treat Suppliers as Partners: This can be through fair contracts, prompt payments, and respect for their timelines.

4. Collaborate on Solutions: Work with your suppliers to solve problems before they escalate. This approach fosters innovation and strengthens long-term partnerships.

5. Review Performance: Regularly review supplier performance to ensure they meet your expectations. But also, be open to feedback on how you can be a better customer.

The Long-Term Benefits

In the long run, building strong supplier relationships leads to a more stable, efficient, and profitable business. You will reduce supply chain risks, improve product quality, and gain access to better terms, including pricing and lead times.

Suppliers who see you as a valued partner are more likely to go the extra mile for you, whether that means rushing an order, giving you insights into market trends, or offering new opportunities.

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So, there you have it.

Focusing on suppliers may not seem as exciting as landing a new customer, but it’s one of the most important factors in long-term success. By investing in your supplier relationships, you’ll be better positioned to meet your customers' needs and stand out in the chemical industry.  

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Thanks for reading, and see you next week.

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Whenever you’re ready, there are 3 ways I can help you:

1. Take the CLEAN Scorecard - test your supply chain. In less than 3-minutes you’ll receive a free personalised report detailing areas where you are strong or weak, and ways you can improve.

2. Book a 15-minute introductory call to see if we would be right to work together.

3. Want a taste of the CLEAN Framework? Take a look at this example company dashboard.