How Expensive Suppliers Negotiate, Part II<\/h3><\/div><\/div><\/div>PurchTips edition #184<\/p>\n<\/div>
How Do You Probe A Supplier’s Value Proposition<\/h4><\/div><\/div><\/div>In the\u00a0last edition of PurchTips<\/a>, I explained the supplier negotiation tactic I call “de-commoditizing” to justify a higher price and how you should handle it in negotiations using five questions. The first two questions were (1) Is the supplier meaningfully differentiated? and (2) Do the supplier’s differences have a measurable financial benefit to your organization?<\/p>\nThe next three questions are:<\/p>\n
\n- Can The Supplier’s Financial Benefits Be Proven?\u00a0<\/b>Any supplier can claim to save you money, but how well do those claims hold up in the real world? Were other customers able to achieve real monetary benefit and track the impact on their companies’ financial statements as a result of taking advantage of the supplier’s unique capabilities?<\/li>\n
- Can The Supplier’s Financial Benefits Be Guaranteed?<\/b>\u00a0Even if other customers have realized positive financial results from the supplier’s differences, will you? There is always a risk that you won’t. So who should bear that risk? A supplier guarantee will give you assurance that your organization’s bottom line will be impacted the way that you expect it to be.<\/li>\n
- Did You Ask For More Attractive Pricing And Terms Anyway?\u00a0<\/b>Just because a supplier can differentiate itself successfully doesn’t mean that there is no room for them to make their pricing and terms more attractive. You can still ask for improvements! As the old saying goes, “If you don’t ask, you don’t get!”<\/li>\n<\/ul>\n
Using these questions to analyze suppliers’ claims of differentiation will help you determine whether the suppliers’ differences have value to your organization and should be considered or if the differentiation claims are just sales tactics that should be discarded. Do be aware that taking a supplier’s unique advantages into account can sometimes result in an unexpectedly more profitable procurement for your organization, despite a higher price. So keep an open mind, but use these questions to focus on what is most important in making a world-class supplier selection.<\/p>\n<\/div><\/div><\/div><\/div><\/div>
Do You Want a More Rewarding Procurement Career?<\/h5><\/div>![](\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/12\/spsm_verify.jpg\" "\\"spsm_verify\\"")
<\/span><\/div>Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Well, guess what? Nothing will change unless you take action towards becoming a world-class procurement professional.<\/p>\n
Earning your SPSM Certification is the action to take if you want to bring the most modern procurement practices into your organization and achieve your career potential. Download the SPSM Certification Guide today to learn how to get started on your journey to a more rewarding procurement career!<\/p>\n<\/div>
Download<\/span><\/a><\/div><\/div><\/div>Need Better Performance From Your Procurement Team?<\/h5><\/div>![](\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/12\/services.jpg\" "\\"services\\"")
<\/span><\/div>Are you a procurement leader whose team isn\u2019t achieving the results you know are possible? Maybe it\u2019s not enough cost savings. Or frustrating performance from the supply base. Or dissatisfied internal customers.<\/p>\n
You need a performance improvement plan that\u2019s easy to implement and quick to produce results. The NLPA can help.<\/p>\n
Download our whitepaper \u201cThe Procurement Leader\u2019s Guide To A More Successful Team.\u201d You\u2019ll learn the 7 steps for transforming your staff into a results-producing, world-class procurement team.<\/p>\n<\/div>
PurchTips edition #184<\/p>\n<\/div>
How Do You Probe A Supplier’s Value Proposition<\/h4><\/div><\/div><\/div>In the\u00a0last edition of PurchTips<\/a>, I explained the supplier negotiation tactic I call “de-commoditizing” to justify a higher price and how you should handle it in negotiations using five questions. The first two questions were (1) Is the supplier meaningfully differentiated? and (2) Do the supplier’s differences have a measurable financial benefit to your organization?<\/p>\nThe next three questions are:<\/p>\n
\n- Can The Supplier’s Financial Benefits Be Proven?\u00a0<\/b>Any supplier can claim to save you money, but how well do those claims hold up in the real world? Were other customers able to achieve real monetary benefit and track the impact on their companies’ financial statements as a result of taking advantage of the supplier’s unique capabilities?<\/li>\n
- Can The Supplier’s Financial Benefits Be Guaranteed?<\/b>\u00a0Even if other customers have realized positive financial results from the supplier’s differences, will you? There is always a risk that you won’t. So who should bear that risk? A supplier guarantee will give you assurance that your organization’s bottom line will be impacted the way that you expect it to be.<\/li>\n
- Did You Ask For More Attractive Pricing And Terms Anyway?\u00a0<\/b>Just because a supplier can differentiate itself successfully doesn’t mean that there is no room for them to make their pricing and terms more attractive. You can still ask for improvements! As the old saying goes, “If you don’t ask, you don’t get!”<\/li>\n<\/ul>\n
Using these questions to analyze suppliers’ claims of differentiation will help you determine whether the suppliers’ differences have value to your organization and should be considered or if the differentiation claims are just sales tactics that should be discarded. Do be aware that taking a supplier’s unique advantages into account can sometimes result in an unexpectedly more profitable procurement for your organization, despite a higher price. So keep an open mind, but use these questions to focus on what is most important in making a world-class supplier selection.<\/p>\n<\/div><\/div><\/div><\/div><\/div>
Do You Want a More Rewarding Procurement Career?<\/h5><\/div><\/span><\/div>Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Well, guess what? Nothing will change unless you take action towards becoming a world-class procurement professional.<\/p>\n
Earning your SPSM Certification is the action to take if you want to bring the most modern procurement practices into your organization and achieve your career potential. Download the SPSM Certification Guide today to learn how to get started on your journey to a more rewarding procurement career!<\/p>\n<\/div>
Download<\/span><\/a><\/div><\/div><\/div>Need Better Performance From Your Procurement Team?<\/h5><\/div><\/span><\/div>Are you a procurement leader whose team isn\u2019t achieving the results you know are possible? Maybe it\u2019s not enough cost savings. Or frustrating performance from the supply base. Or dissatisfied internal customers.<\/p>\n
You need a performance improvement plan that\u2019s easy to implement and quick to produce results. The NLPA can help.<\/p>\n
Download our whitepaper \u201cThe Procurement Leader\u2019s Guide To A More Successful Team.\u201d You\u2019ll learn the 7 steps for transforming your staff into a results-producing, world-class procurement team.<\/p>\n<\/div>
In the\u00a0last edition of PurchTips<\/a>, I explained the supplier negotiation tactic I call “de-commoditizing” to justify a higher price and how you should handle it in negotiations using five questions. The first two questions were (1) Is the supplier meaningfully differentiated? and (2) Do the supplier’s differences have a measurable financial benefit to your organization?<\/p>\n The next three questions are:<\/p>\n Using these questions to analyze suppliers’ claims of differentiation will help you determine whether the suppliers’ differences have value to your organization and should be considered or if the differentiation claims are just sales tactics that should be discarded. Do be aware that taking a supplier’s unique advantages into account can sometimes result in an unexpectedly more profitable procurement for your organization, despite a higher price. So keep an open mind, but use these questions to focus on what is most important in making a world-class supplier selection.<\/p>\n<\/div><\/div><\/div><\/div><\/div> Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Well, guess what? Nothing will change unless you take action towards becoming a world-class procurement professional.<\/p>\n Earning your SPSM Certification is the action to take if you want to bring the most modern procurement practices into your organization and achieve your career potential. Download the SPSM Certification Guide today to learn how to get started on your journey to a more rewarding procurement career!<\/p>\n<\/div> Are you a procurement leader whose team isn\u2019t achieving the results you know are possible? Maybe it\u2019s not enough cost savings. Or frustrating performance from the supply base. Or dissatisfied internal customers.<\/p>\n You need a performance improvement plan that\u2019s easy to implement and quick to produce results. The NLPA can help.<\/p>\n Download our whitepaper \u201cThe Procurement Leader\u2019s Guide To A More Successful Team.\u201d You\u2019ll learn the 7 steps for transforming your staff into a results-producing, world-class procurement team.<\/p>\n<\/div>\n
Do You Want a More Rewarding Procurement Career?<\/h5><\/div>
<\/span><\/div>Need Better Performance From Your Procurement Team?<\/h5><\/div>
<\/span><\/div>
![](\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/12\/services-contracting.jpg\" "\\"services-contracting\\"")
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