Add Vendor Relationships to Your Mid-Year Review
- By Keith Lubner
- October 01, 2007
Like most companies, we conduct an internal mid-year review. Ours is typically held on a beach, where we find our minds are clearer, we can be more honest with ourselves about execution and we can often make difficult decisions. While you probably hold mid-year reviews too, don't forget to include evaluation of vendor relationships in your agenda. Below are two areas for you to initially focus on:
Very important in our analysis of what's going right and wrong this year is a hard look at whom we're doing business with. Are current clients a source of joy or a cause of grief? Do current engagements fit our ideal model? Just like us, you should look at the vendors you partner with. Even early in a vendor relationship, you'll be able to assess whether expectations are being met-or at least have the capability to be met. In addition, the vendor's actions may have raised red flags. Maybe the vendor is acting differently from when you made the decision to partner with them. Or maybe they've had many internal changes that have caused problems for you. In either case, you need to think long and hard about continuing the relationship.
An executive vice president at one of my clients truly understands how to put forth meaningful business metrics. I've taken a few tips from him that allow me to make better projections for the monetary aspect of my relationship with my clients. I look at not only how much is coming in and going out, but what it means on a per-program basis. In other words, I break down my offerings and figure out which ones are the most profitable in relation to our time and efforts. The same works for analyzing vendor relationships. If you followed my advice from previous columns, you've figured out how much the potential relationship could be worth to your business. Midway through the year is the time to measure against that goal. If you're not on target but are moving in the right direction, it's OK. Just make sure the money is there and the software and services revenues are trending the right way. It helps to go a little deeper. Trend your marketing costs, cost of sales and other overhead. Add them all up and compare the total to your initial projections, but don't get alarmed if you're not meeting the goal just yet-as long as you feel you're heading in the right direction. Do get alarmed if all of the trends are negative.
Be Proactive-and Reap the Rewards
Now you're doing your homework, but what about the vendor? A good vendor will take the initiative and schedule a mid-year review with you anyway. They'll be proactive-especially with newer partners. But vendors who aren't that proactive aren't automatically bad. Pick up the phone, schedule the meeting and then immediately send an agenda. Good vendors will embrace your enthusiasm, which will elevate you in their eyes. This elevation will bring forth many benefits in the long term, such as more sales leads and more co-marketing dollars.
You wouldn't wait until the end of the year to analyze how your business is doing. Be sure to include a vendor-relationship analysis in that mid-year review, when you've still got time to make a course correction.
Keith Lubner is Chief Business Strategist at Sales Gravy, the sales acceleration company, and managing partner of C3 Channel, a global consulting organization focused on channel strategy, design, enablement, outsourcing and training for growing companies. For more information about Keith, visit www.c3channel.com, www.channeleq.co or www.salesgravy.com.