In the world of business, you need to know how to spot a bad vendor. We’ve looked at other real-world problems before, like commercial robbery statistics and prevention. Though we don’t relish the thought of having to prepare (or actually deal) with such awful situations, they remain a fact of life. Vendors (or suppliers) are quite helpful resources, after all, you simply cannot do everything on your own. You need their products and services to provide your customers with products and services, it’s that simple. Since these relationships are a necessity, it’s helpful to know how to avoid bad vendors.
The Big Business Vendor Debacle
The role of an entrepreneur is diverse, to say the least. You shoulder ultimate responsibility and no how minor a decision is, it’s important to the health of your company. Unfortunately, this invites anxiety and also compromises judgment. It’s why too many business owners make rash decisions. They fall victim to the old curse of stepping over dollars to pick up pennies. Vendors are quite aware of this phenomenon. Getting you to focus on the short-term benefits helps to take your attention away from long-term consequences.
The success of your small business depends on making smart deals that expand available resources and enable continued growth. Just as important are the deals you walk away from — thus avoiding costly mistakes that waste time, consume energy, and threaten to derail your success. —Intuit Quickbooks
This is where the big business vendor debacle comes into play. You need third-party vendors to do things you aren’t equipped to do on your own. A common example are credit card processing vendors. You need to accept debit and credit cards to accommodate your customers. This isn’t a secret and it’s why small business retailers are constantly approached with sales pitches. When enough shiny things are thrown out, it’s tough to resist. Persuasion and pressure are applied repeatedly. In the moment, it’s easy to say yes but that doesn’t make it a good deal.
How to Spot a Bad Vendor
Outside help is typically a necessity for businesses. Very few can handle everything that needs to be done to get things done. The right vendors can help you succeed but the wrong ones will create more problems than they are worth. Before you sign on the dotted line, take some time to vet the company, if possible. Fortunately, bad vendors do share some telltale qualities. Here are some of the most common warning signs of a bad vendor:
- All too eager to strike a deal. Okay, so every salesperson you meet is eager to strike a deal. But there are people who really stand out from the rest. They offer a lot and seem willing to go way beyond the extra mile before establishing any rapport. For instance, offering unusual enticements or deep discounts are generally red flags.
- The devil really is in the details. A contract reading like your state’s statutes is written that way for a reason. Sure, it’s legalese and that’s expected in the business world. But when it’s so dense it reads like James Joyce’s Finnegans Wake, there’s something awry. Trouble is, you won’t learn about costly details until they are sprung.
- Their employer mandates quotas. While it isn’t at all unusual for companies to mandate sales quotas, some entities are downright unrealistic. This unreasonable demand causes salespeople to embellish, obfuscate, and engage in one or more slick shenanigans to get you to sign. Do yourself a favor and research the company before making a commitment.
- Customer service isn’t at the forefront. If you are dazzled by all the benefits and perks but hear little to nothing about the super helpful customer service, there’s probably a reason for the omission. If customer service isn’t one of the strongest sales points, that too, is a big red flag.
- Trust your gut instincts with every decision. Finally, don’t discount your gut instinct. It’s there precisely to sound an alarm to help you avoid a bad decision. If it doesn’t feel right, it’s probably because it’s just too good to be true.
Have you dealt with a bad vendor? How did you resolve the situation? What’s your advice for avoiding bad vendors? Please share your experiences and thoughts!