30 March 2016

Are you a customer of choice?

Have you ever wondered whether your competitors are getting better prices, service and innovation from your category suppliers?  If so, undertaking the Supplier Confidence Index could give you the answer.

Understanding the supplier’s view using the Supplier Confidence Index takes into consideration two major factors:

- The relative value of your organisation’s business to the supplier, in terms of both current and potential financial returns.

- The attractiveness of your organisation as a customer – whether you are easy or difficult to work with, have a strong brand and pay your suppliers on time.

Where the relative value of your business is high to the supplier, and you are an attractive customer, your suppliers may perceive you as core customers. They prioritise service, provide the best account resources and generally work collaboratively to achieve mutual gain. At the other end of the spectrum, where you are low value and not particularly attractive to the supplier, you might be perceived as a nuisance customer. You demand more than the supplier wants to give, and the supplier lets you know – by reducing service levels, issuing blanket price increases, or even redirecting your business through a distributor.

Do you want to work with a supplier that sees you as a nuisance in one of your strategic categories? How can you improve our attractiveness to become a more favoured customer? And is your organisation better off working with a smaller supplier that values your organisation as a customer, rather than a larger supplier that views you as a commodity? By understanding where your suppliers position you as customers, you can start to assess whether you are working with the right suppliers for your categories.

This is why The Faculty has developed the Supplier Confidence Index (SCI) to measure supplier confidence as a key indicator of the depth, quality and effectiveness of organisations’ supplier relationships.  The index assists in determining whether organisations are considered customers of choice for suppliers and provides insight into how suppliers perceive organisations in terms of alignment, strategic fit and cost to serve.  Ultimately, the SCI demonstrates the level of confidence that suppliers have in their customers. If you would like to know more about how The Faculty SCI could help you to become a customer of choice for your suppliers, then please contact The Faculty.

The Faculty Roundtable comprises of an influential group of procurement leaders who gather to share their experiences and insights, to achieve greater commercial success for their organisations. Through The Roundtable, members have access to leading-edge thought leadership and commentators, a ready supply of valuable expertise through exclusive market intelligence, as well as networking and professional development opportunities for themselves and their team members.

The Asia-Pacific CPO Forum is the region’s premier procurement event dedicated to accelerating commercial leadership at the highest level. It is a once-a-year opportunity for leading Chief Procurement Officers to engage with peers and like-minded business leaders in an intimate and interactive setting. The Forum is designed for delegates to facilitate the sharing of best practice strategies, develop innovative and responsive procurement approaches, and hear from a compelling speaker line-up of influential thinkers, eminent business leaders and commercially creative minds.

In 2016, The 9th Annual Asia-Pacific CPO Forum will held on 18th and 19th May in Melbourne, Australia. For more information contact Program Manager, Belinda Toohey, on +61 3 9654 4900 or via email.​ 

[Image credit: tech.co]