In a recent blog (at I wrote about how my company handled driving internal customer loyalty in order to drive sustainable end customer loyalty.  I believe strongly that it is critical to have a well-oiled loyal team supporting your customers to achieve repeatable long term revenue streams.  But being open and accessible to employees and evangelical about driving loyalty internally is insufficient.  If you are like most businesses, a key ingredient to your loyalty pie for end customers has got to be your vendors.  So if they are not part of your overall loyalty strategy, you are not maximizing your loyalty efforts.  In this fourth part of my “What Next?” series I will explore the concept of vendor loyalty.

From cash flow, to pricing, to delivery, to special requests you need to have as good a working relationship with your vendors as you do with your end and internal customers.  If you are wondering why, you are in trouble.

Let’s start off with the most obvious of vendor requirements, pricing.  Are you getting the best pricing?  Really?  How do you know for sure?  Many vendors have tiered pricing, the larger you are the better discount and other perks you get.  You may be getting the best possible pricing off the price sheet you get shown, but still may be paying 10-20% more than your competition.  Wondering why you are losing bids on a certain product line?  Other vendors give better pricing to customers who have taken the time to certify employees.  In fact, in many settings certain higher quality product lines are reserved only for certified customers.  If you don’t get to really know your vendor, you may never understand the requirements to get to these better pricing levels.  As they say “dumb and happy” isn’t a good place to be.

How about a critical delivery need, or a special customer request (say for a slight alteration in a product)?  If you have not established a good relationship with your vendor you may find that you are unable to meet a commitment, bid on a project, or simply keep your customer happy.  Talk about killing long term customer loyalty in a heartbeat, right?  But if you have taken the time to build that relationship, doing things like taking sales person calls and agreeing to meet with them periodically, etc. you have a much higher probability of obtaining concessions or action in order to fulfill your customer commitments.

Finally, if you are a small business, I’m willing to bet cash flow can be an issue at times.  One way to deal with this is working with your vendors to “slow pay”.  If, like many businesses, you just start paying vendors late you are most likely going to run into troubles.  Vendors don’t like delayed payments and you may find yourself facing delays in shipments for critical projects, or worse, like the imposition of down payment requirements or an outright hold on your account.  We experienced such situations, but because I had introduced myself to the accounting team at our key vendors, talked to them regularly, and most importantly was open and honest with them about our situation.  I always was able to work through short falls in cash flow, often for periods of months a time.  In essence our vendors became our bank and did so happily for a loyal customer.

One of the best ways to kick off a relationship with your vendors is to outline your customer loyalty strategy to them.  Tell them what you do to generate internal customer loyalty along with the key components of your end customer loyalty that you have been able to establish.  Then tell them what constitutes loyalty from them in your mind, and ask them what they view as loyalty from a customer.  What a concept, no?  I guarantee, having loyal vendors is just as key to sustainable customer loyalty as internal customer loyalty is.  Don’t slight your vendors in your strive for success.