Negotiating and Influencing Prices with Suppliers

Expert strategies to influence and negotiate the best prices with your suppliers:

  • Know the difference between your bid price and buy price.
    • If you’re awarded a project, go back to the supplier and ask for the buy price. It is likely there will be more room to negotiate at this stage.
  • Decrease their risk & increase sales volume
    • Will they do long term contracts?
    • Mention foreseeable repeatability, if you win this project, will it lead to more from this GC or Builder?
    • Buy in bulk – learn more on our recent blog post here.
  • Relationship Building
    •  Be professional and responsive.
  • Customer Loyalty
    • Do they think you’re just shopping around for the best number?
  • Prompt Payment
    • Can you offer credit references? I.e. A different supplier or industry partner verifying that you have a history of paying on time and continuing business loyalty
  • Offer referrals
    • You will help spread the word about their great service and product availability

The supplier isn’t the only who should benefit from your relationship – ask what’s in it for you?

  • What are their delivery times & rates?
  • Discounts? Is the pricing ever based on volume?
  • Difference between price flexibility for low margin & high margin items?
  • How long will a pricing offer stand? What if the job gets delayed?
  • What’s their backorder percentage?
  • Return policy for damaged product?
  • How quickly can they get pricing back to you? (they obviously don’t want to be shopped either)
  • Can you leverage competitor price matching?

By: Liz Zofka




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