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12 tips to help SMBs select and manage vendors

Jennifer Lonoff Schiff | Aug. 26, 2016
Small business owners and experts share their strategies on how to build a successful, lasting partnership with suppliers/vendors.

3. Determine if the vendor can scale – or downsize – with you. “Just as SMBs need to consider scalability when selecting software solutions, they also need to understand how vendors and partners can accommodate expected growth plans, including geographic territory support, hours of operation and additional services required,” says Doron Gordon, CEO, Samanage, a service desk & asset management solution provider.

“Similarly, understand the consequences if your business downsizes,” he adds. “Does this partner have a minimum contract each month, and will you be able to negotiate if your needs change?”

“When evaluating vendors, don’t think about just whether they can solve your needs today, but also think about how flexible they are to support future growth,” says Leo Castro, vice president, Product Marketing and Brand, BigCommerce. “That can mean having built-in features that scale, but should also include a platform that you can customize when you’re ready for it. Also, look at the customers they feature on their website. If they have customers like you, as well as customers that look like how you want to be in 5 years, that’s a good sign.”

4. Get and check references – and not just the glowing ones. “It's great to speak with [a vendor’s] favorite reference customer or see their best work in a case study, but try talking to some of their current or former customers [who may not offer such glowing reviews] or even their former staff, [too],” says John-Henry Scherck, growth marketing manager, DocSend. “You will learn a lot about what it's actually like to work with them as opposed to what their sales team wants you to think what working with them is like.” 

5. Vet vendors’ security. “Outsourcing infrastructure, data storage and applications hosting to a cloud provider enables resource savings and likely strengthens security, but SMBs shouldn’t sit back and relax,” says Chris Caldwell, CEO, LockPath. “Your organization owns the data and is ultimately responsible for it, even if outsourcing to a cloud provider means the data is not under your direct control.” So make sure any vendor you contract with complies with industry and government standards (if applicable) before you entrust them to handle any customer or company data.

6. Try before you buy. “The best advice I can share when trying to find the right vendor or partner is to work with them first,” says Nick Braun, founder & CEO, PetInsuranceQuotes.com. “If you can do a low cost, low risk project together or give them a try for a month that is the best way to ensure you’ll find the right partners. If someone wants a 6-12 month contract up front, that’s a bad deal for you.”

 

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