In friendship as in business, the relationship should be mutually beneficial, and, as with any close association, will involve respect, trust and a mutual dependency.
A company may have a casual, friendly long-term relationship with a supplier; however if both parties want to strengthen the existing link, they will need to sit down and discuss every aspect of the relation. For instance, a business might have been placing orders as things come with the same supplier for years, without having tried to give – and get – the best deals. This is not exactly a long-term supplier/client relationship. If both parties take the time to meet, discuss and plan what amount of business is planned both on a quantitative (volume/value of orders) and qualitative (expectations, ethics) aspects for the coming year(s), a great deal of rationalising can be decided upon – to each partner’s advantage.
For instance, the supplier may now count on a certain amount of business throughout the year and prepare his production planning accordingly, benefiting thus from better prices when buying raw materials and passing on the price drop to the client.
Knowing that the raw material has been ordered in bulk and is easily available to the supplier is reassuring for the client as it means they can count on a greater reactivity if need arises.
There are other issues to be addressed in detail to build the partnership on solid grounds: they involve invoicing, payment terms, delivery times etc. but also a better knowledge of each other’s environment to find the best solution together. Transparency on both sides is crucial to establish trust. Knowledge of each other’s market and constraints may prevent future disagreements.