Unless you work in a Communist State or in the Public Sector, all businesses are interdependent. What this means is that without other similar businesses around, your business would struggle to exist. Is that a good thing?
The supply chain
Although you may think that you can survive by yourself, just stop and think about how reliant your are on receiving your wholesale supplies. This doesn’t just apply to products. There are many wholesale suppliers to the service industry such as IT Services or the Yellow Pages. Could you really exist without any external help?
Keep your supply chain options open
It’s all and well having a reliable, automated set of suppliers. But what happens if a supplier goes bankrupt? What happens if a supplier goes on strike? You have to have an alternative plan in place in case the worst happens.
If you don’t have an alternative plan in place then it’s your customers that will suffer. Even although you may have existing service level agreements in place with your suppliers, nothing is guaranteed in business.
Arrange an alternative supply chain
There are bound to be supplier companies out there dying to win your business. Why not arrange a ‘first alternative’ option with them? I. e. If your existing suppliers let you down, you’ve already arranged which company you will call. This has two benefits for you. You’ve already ascertained that the alternative supplier has the capability of meeting your volume requirements. You’ll also be able to agree a price before the emergency happens. Then the new supplier won’t be able to hold you to ransom.
Are your competitors really your competition?
It’s also important to conduct a thorough analysis on your competition. Then meet them for lunch. First of all review your local competitor’s product and service offering. Review how much they’re charging and who their existing clients are. The chances are that after you take your magnifying glasses off you’ll realise that your businesses are more different than similar. This means that you both have a lot to talk about.
You don’t have to be scared about meeting your ‘competition’ for lunch. You’re not going to talk about you existing profits or your existing operating systems. So you’re not divulging any significant trade secrets. The worst thing that will come out of the meeting is an occasional customer referral. The best thing that will come out of the meeting is a long-term strategic alliance.
Do you co-exist or are you making things hard for yourself?
The majority of businesses that try to survive without continually analysing their supply chain and interacting with their so-called competition aren’t living up to their full potential. The fact that businesses are interdependent is a good thing only if businesses themselves recognise it and embrace it. Only then can they take full advantage of the subtle relationships that can significantly impact their customer offering.
David Bain is founder of the independent business articles resource, http://www.BuildYourOwnBusiness.biz . BuildYourOwnBusiness offers the latest business news & management advice on how best to build your own business - business articles on Strategy, eBusiness, Change Management & much, much more.