Last Updated May 8, 2007 3:24 PM EDT
Often a team of key staff people will have influence in choosing a supplier for a company. This decision-making team may include staff members from various departments such as purchasing, manufacturing, marketing, and finance, and each individual team member will have influence at different stages of the purchasing process.
If you're a potential supplier, it's worth your while to identify all of the people who have influence in deciding whether to use your product and communicate with them at the appropriate stage. Getting to know these individuals, and their interests and needs, may make all the difference in achieving a sale.
First off, be cautious in approaching the company or other team members directly. Purchasing managers may resent your efforts if they you are undermining them. Instead, consider conducting research to discover whom within your customer's company shows interest in your products. Telephone research, direct mail, or advertising with a response mechanism are some methods you can use to achieve this goal.
Though it may suffice to only deal with the person who orders the products in this case, you may be missing out on new business opportunities. You also might miss out on important information that will allow you to anticipate changes in customer needs or learn about performance issues. Communicating with the full decision-making team will allow you to better monitor and improve your relationship with the company.
Generally, meeting with sales representatives is a low priority for busy directors. Instead of approaching them with a sales pitch, consider inviting directors to a seminar or workshop on a topic that is directly relevant to them. This provides you an opportunity to talk with key influencers informally and learn about their needs in a low-pressure environment.
The more a product is of strategic importance to a company, the more likely a team will be involved in making the purchasing decision. Therefore, your first step in researching the decision-making team is to ask: How significant is this purchase to my customer? A team is more likely to be involved in making a purchasing decision if the product or service required is:
- vital to the company's success;
- technically complex;
- of high value.
Low value purchasing decisions are more often decided based on price and delivery alone, so fewer people need to be involved.
If you determine the purchase is strategically important and of high value to your customer, you can move forward with researching likely members of the decision-making team.
Each of the individuals who influence a purchasing decision will make different contributions to the decision-making process and require different information. The size of a decision-making team will vary depending on the value and complexity of the purchase, but it could include senior executives, purchasing professionals, technical employees, manufacturing managers, service providers, marketing specialists, and departmental managers.
Senior executives are interested in managing risk, since product or service failures may damage their business. Though they may not be involved in the day-to-day process of making a purchasing decision, you will want to give them an overview of your product or service offerings and reassure them you will be a reliable long-term supplier.
If addition, it is often useful to engage the company's board of directors in the decision-making process, so that the decision takes on strategic significance. Achieving commitment to your product from the organization's leadership can increase the company's dependence on you as a supplier and assist with account control.
Purchasing professionals likely will be your main point-of-contact on the decision-making team. They also may be instrumental in identifying your company as an "approved" or "preferred" supplier, so it makes sense to stay attuned to their needs. Often these include demonstrating that you meet a list of established criteria. Or they may want to measure and rate your performance over time. Purchasing professionals will appreciate your cooperating with their requests, because it helps them better serve their internal customers.
Finance executives generally only get involved in purchasing decisions if the purchase is complex or would involve a major capital expense. In either of these cases, you should note that these executives have ultimate control over purchasing budgets. Your communication with them should focus on reassuring them that you offer value for their money and the best possible return on investment.
Financing options also will be of interest to finance executives; offering flexible options such as leasing or deferred payments may help to increase your competitive position.
In many cases technical employees are a key part of the team choosing a product supplier. Especially if you are a supplier to technology-oriented companies, it is worthwhile developing a good relationship with these influential team members.
Consider meeting or consulting with technical employees at various stages: For instance, in the planning stage, you can meet with them to make suggestions that influence product design; or, as existing products are undergoing enhancements, you can make suggestions to improve product performance. You might also assist technical employees with contract development, employee training, or other specialist, technical services as they move into new markets. Helping technical employees provide better service to their internal and external customers will give them a positive view of your company and products.
In some cases, manufacturing managers might be key influencers in a decision-making team. You especially should approach them if you are launching an innovative product or have identified ways to improve the company's manufacturing process or efficiency, or reduce their costs.
Service providers deal with areas such as maintenance, training, administration, logistics, information technology (IT), and other services that enable businesses to operate day-to-day. If you are a provider of professional services, it is worthwhile to cultivate relationships with these individuals to explore how they might depend on your services to increase efficiency or reduce costs.
Marketing specialists will be interested in how your service adds value or helps the company increase its competitiveness. They will most likely be involved with decision-making if your customers are seeking to improve their market position or are entering new markets where you have a specific expertise.
Departmental managers often are the ultimate users of your products or services. They will be interested in hearing about your product or service's benefits, and how it will make their lives easier. Their opinion will be important to the final decision, and they also will be involved in evaluating the product over time.
You should note that team members' influence varies at different stages during the purchasing process. For instance, purchasing employees and departmental managers may have more influence early on when product specifications are determined. Technical employees may be involved later, when proposals are evaluated.
Once you have a list potential decision makers, you need to determine who is actually involved in the purchasing process. Your sales person or another staff person in regular contact with the customer is best placed to fulfill this task. What follows are some research methods you can use for identifying key influencers:
- Conduct independent research into how companies make purchases; you might choose to limit this research to a specific group of customers, or conduct it industry-wide.
- Review or conduct industry surveys on buying patterns; these may provide broad guidelines on how decisions are made within an industry, but you still should qualify them with research specific to your customer.
- Produce advertising with a direct response mechanism, and then analyze the responses to see decision-making patterns.
- Initiate joint projects, in which members of your customer's staff work with your staff; this is a great way to learn first-hand about relationships among your customer's staff and their approval procedures.
Since purchasing teams and influencers are continually evolving as people change their jobs or individual contributions change, whatever research you do should be conducted continuously. It is important to note that purchasing is a dynamic activity.
You should note that companies rarely make clear who are the key influencers in purchasing decisions. Take care not to make assumptions, and do your research! You will be wasting time working to persuade a customer's purchasing manager about your product's superiority if another team member is actually reviewing product proposals.
If a purchase is significant, more senior-level executives may be involved in deciding upon a supplier. Be sure to take note if you are selling an innovative component that will, for instance, allow your customer to develop a new product or enter new markets. In this case, your company is not just a supplier but a potential strategic partner. You should communicate with senior decision makers, not only the person who issues purchase orders.
Purchasing requirements—and decision makers—are continually changing as products and the companies that produce them change. Note that people and products come and go, and so do key influencers. To stay current, it is important to conduct research on an ongoing basis.
Tuleja, Tad, et al.
Marketing Research Association: www.mra-net.org