Keep Your Suppliers Eager To Deliver Top Notch Customer Service Quality With A 70/30 Split
To keep your suppliers on their toes and keep their customer service quality high, try this smart tip I learned from the Group Purchasing Manager of Asia Pacific Breweries.
Whenever he contracts to purchase items from more than one supplier, he gives one vendor 70% of the total purchase, while a second vendor gets 30%. And he tells them both exactly what he is doing.
Why this unequal split? And why tell the two suppliers about it? Here’s why:
If the first vendor does a good job and keeps customer service quality high, she knows she is keeping well over half the total purchase volume. But if she does a poor job, she knows she stands to lose more than half of what she is currently supplying.
On the other hand, if the second vendor does a great job, he knows he could more than double his orders if he takes over from the first vendor. However, if he does a poor job, he knows he is dispensable as he supplies less than half the company’s required volume.
This is an interesting technique for motivating supplier partners that smart purchasing managers understand. Now you know about it, too.
Key Learning Point For Customer Service Quality
Effective purchasing programs with your supplier partners help everyone succeed. Be deliberate, and creative, in your contracts to inspire the best in others. A little competition can keep customer service quality high to the benefit of all involved.
Action Steps For Customer Service Quality
Identify your most important supplier partners. Review your agreements with them on a regular basis. Be sure they are motivated to give you the best customer service quality they can right now, with an eye towards more business in the future. This is a great way to motivate excellence and it can only benefit your business by ensuring you get the best from suppliers.
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Copyright, Ron Kaufman. Used with permission. Ron Kaufman is the world’s leading educator and motivator for upgrading customer service and uplifting service culture. He is author of the bestselling “Uplifting Service” book and founder of Uplifting Service. To enjoy more customer service training and service culture articles, visit UpliftingService.com.
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