At the recent STAFDA convention in Las Vegas, many speakers used the term “relationship” in their presentations.

It was a critical element running through all of the speeches I heard—starting relationships, developing relationships, nurturing relationships, keeping relationships, losing relationships, building relationships, managing relationships. You get the idea.

It’s a valid point. But let’s examine the whole “relationship thing” in more detail.

Just what does “relationship” mean? Webster defines the word as “A particular type of connection between people, related to, or having dealings with each other.”

“A connection between people.” As manufacturers, we are connected to you, the distributors, not so much by our pricing, services or even our products—but most importantly by our people.

Our company is constantly working to develop and grow “connections” with the people at all levels of our distributor organizations.

We need to have improved connections with the people who work in shipping, receiving, customer service, sales, marketing and product development, as well as those in senior level management. It is by growing these connections that we will start to build and strengthen relationships.

How much is a relationship worth? In today’s global economy, with information available over the Internet in a millisecond and companies in emerging markets capable of playing on the world stage, the competition is fierce and the choices are many.

How much are the relationships with your supplier worth? Are they among the key assets of your business?

The company I work for was founded in 1841. One of the major tenets of the organization has been the fostering of “long term relationships” with various customers, employees and vendors.

Some employees have retired with more than 50 years of service. Many of our customers have been buying from us for more than 40 years. We still manufacture our products in the same town where we were founded more than 165 years ago.

In other words, many of our key relationships are based on intangibles. Relationships and their importance can sometimes be overlooked if all eyes are focused on price—and nothing but price.

Will you rotate your business from one supplier to another for 5 percent, 15 percent, or even 30 percent in price savings without considering the relationship? Before doing so, here are some key questions you might ask yourself:

• What percentage or value do you put on a relationship?
• How can it be measured? What components of the relationship mean more than others?
• What do they total?
• Have you calculated the cost of changing or losing a relationship?
• What is the importance of that relationship in the marketplace and on your bottom line? Do you know?

The relationships you have with your key suppliers are priceless—literally. They cannot be measured in dollars and cents, or time or contribution. They are invaluable.

When you come right down to it, can you really afford to not have a relationship?

Author Information

Carl Schneider is president of Josef Kihlberg of America, a manufacturer of pneumatic nailing and stapling tools. Schneider is based in Syracuse, N.Y., www.kihlberg.com.