By Mr Retail
Choosing the vendors in your store is one of the most important decisions you will make.
While installers and service departments are the lifeblood of our industry, if we don’t sell something, there is nothing to install. So let’s talk about negotiating the best prices and programs for that product.
Most folks assume that the price sheet you get from vendors and distributors is a “take it or leave it” proposition. But, in fact, other options may be available to you.
Let’s assume you want to bring in a new line of amps, speakers, and enclosures. Once you have seen the price sheet and programs offered, you sit down and compare it to your current vendor’s pricing. You instantly notice that some things are better and some are worse.
Now, you could just accept what is given and decide to move onto a different vendor, or you could start a dialogue with this new vendor.
I think it is important to keep several things in mind. If you want to cherry pick a line, you will have less opportunity to get off-sheet deals than if you fully support the line. But sometimes vendors/distributors want to get their foot in your door and will sweeten the pot in order to do so.
Some options for negotiating could be lowered freight levels, lower master pack surcharges, or getting “meet comp pricing” on certain SKUs where this vendor is not competitive. An example could be the vendor’s 500w mono amp that is supposed to be a value model, but the retail is $280 and you need to be $250. Discuss this with them as a smart vendor looks at the total package of business and not 3-4 items that need competitive price adjustments. Sometimes things like payment terms or field destroy can also be on the table.
In closing, consider that a vendor is your business partner and not a vending machine. Talking to them like a partner and discussing a long-term strategy goes a long way these days. They want your business and they want to be profitable. As long as these two items can co-exist, you have found a winner.
One final piece of advice would be to stay humble in all of your conversations. Pride and short tempers will get you nowhere and will negatively impact your reputation as all vendors and reps talk to one another.
About Mr Retail
Mr Retail offers opinions and information on car audio retailing for CEoutlook. He wishes to remain anonymous. He has owned a retail store in this country for over 20 years now. Mr Retail loves what he does and loves the 12 volt industry and is happy to share his hard won expertise.
Thank you, Anonymous, for the article on this important topic. When I went to the Dallas KnowledgeFest 2019 I realized that my best experience was sitting next to these two young men that had just started their own operation. To watch them take notes and consume what knowledge they can so they can go back to the open sea and gather their catch. So many memories came rushing back.
I will share one of these memories…Around 1992 I went to a MERA KnowledgeFest in Pleasanton, CA. I spent some time with Bob Graham from Breakers Stereo from Oxnard, CA. I shared some of my trials with him and he looked at me with a very kind smile and said…”You need consulting.” Well, that day changed the rest of my life. Thank you, Bob, for your wisdom.
Now to the topic of choosing a vendor. The number one reason you should choose a vendor is relationship. The relationship you have with your customer should be likewise with your vendor. You are investing in your customers, and they are investing in you. But what seals the deal is how much each person really cares.
Is the rep just there to get a P.O. or to help you grow your business, as they are asking you to help grow theirs? The little difference between prices is nothing compared to what that vendor could do for you and your business.
If the vendor can lower their price immediately, proceed with caution because they are already overcharging and in it for themselves. I have two vendors that came in with one price and said this price is the price and it’s good for everyone. They have stayed true to this, and they have been the best vendors since 1984. There are so many things they do and bring to the table to aid and assist to make Miles of Smiles for everyone involved.
Lastly, to get ahead of your decision of what vendor to grow with, as Anonymous states, all vendors and reps talk. Well, so do we retailers. Call your friends in the biz and check out their resume, do they work or just take P.O.s? Interview them with a list of questions you want to ask. Remember they are interviewing you, why can’t you do likewise?
In closing, don’t be a buffet table of brands. Have as many as you can truly support. This will go a long way. In 1982 I had a little sales seminar given to me. It’s short and oh, how sweet. “Believe In What You’re Doing and Never Tell a Lie” And finally the best part is, if you find a sales rep that really understands and knows how relationships work, you will have a Friend for life! Mobile Mike, Santa Rosa Cartunes – srcartunes.com.