When was the last time you successfully bargained with your supplier? It’s the best way to reduce your expenses and gain more profits for your business, isn’t it? Yes, everything can be compromised but you must remember this: The deal should bring mutual benefits. Now, let’s find out the 7 practical tips for negotiating with suppliers to get the best deal!
Build a solid relationship and communication
When purchasing for the first time, it’s unlikely that you will get to bargain with a fantastic offer. But that’s fine. It’s your chance to build a strong relationship with your supplier beforehand.
Once you’ve established the relationship, start negotiating for a cheaper price. By showing that you have been caring and responsive to any issue, you can show them that you’re the one with the upper hand.
Research the real price
You can almost feel the victory when you’re sitting with your supplier, about to negotiate, and you have known the product that they sell like the back of your hand. By knowing how much it costs to make the product, you can wiggle it at the best rate while ensuring your supplier earns enough.
Show them how you’re going to benefit them
Your supplier is a businessman, just like you. They want to sell as many products as they can and they will respect any customer who helps them achieve the target. So, when you’re negotiating, it’s important to consider how you’re going to benefit them.
You can promise them to repeat the orders, for example. Or, if you already have a history of being a partner, you can bring evidence of how loyal you are. Then, provide them with a purchase projection based on that logic and the research that you have done.
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Bargain other things outside the price list
If your supplier is persistent and not going to bring the product price down, get over the price list. You can shift your bargaining into other offers such as lower down payment, bulk purchase discount, faster delivery, cheaper delivery fee, longer warranty, and many more.
Own quotes from other suppliers
Make sure that you own at least three quotations from different supplies. Explain to them how important it is for you to take the most competitive bid. This strategy will usually soften them a bit. However, don’t sacrifice the quality of the goods/services for the sake of cheaper prices and pride.
Find references from other customers
The best information about suppliers comes from their customers. Before starting any negotiation, ask your suppliers to hand you a list of their customers whom you can ask for reference for.
People love talking about the products they like and most of the time they don’t mind sharing the deal they got from your supplier.
Prepare large deposits for easier negotiations
Your supplier has a concern on their account receivable as well. If you want to bid them at the lowest price, try to offer them 50-70% deposits of the total price. The larger amount you can provide, the stronger you are.
Bargaining with your supplier should not be difficult, yet you still need a plan before doing it. Try those tips for negotiating with suppliers above and win the best deal!
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