Left Anything Behind?
Those Vendor Agreements
So you have been taking a look at the agreements in place with your suppliers and making sure that they are all up to date and that any changes that need to be made are addressed.
Organized and efficient, you are on top of all of your agreements.
But did you leave something behind?
Negotiating Agreements Well
Negotiation is the key to establishing the best possible terms with your vendors. Everything does not need to remain the way it is has always been. There are numerous opportunities to maximize agreements, many of which can directly affect your bottom line and lead to increasing the value of your aviation company. Before you finalize new agreements or renew old ones, here are a few things consider to see if you are missing anything:
- Volume discounts — Volume discounts are often available on a “per order” basis, but some vendors also make them available when you reach a certain total order volume. It may be that the length of time you have been a customer entitles you to additional discounts. Some of these may not specifically be spelled out, but can be negotiated.
- Payment terms — Every vendor will have standard payment terms, but are you taking advantage of the best available terms? Are you maximizing what is available to you? It’s important to pay on time and as required, but it may be worth discussing payment terms with your vendors. Especially if you have established good relationships with your vendors, there may be more leeway available than you are taking advantage of.
- Bonuses — If you buy goods or services in volume or you have been a long time customer, you may be able to negotiate bonuses of various kinds periodically. Good vendors want to treat good customers well because they know the long term benefit of those relationships. Isn’t that what you want to do with your best customers?
- Order & delivery options — You may have always ordered the same way and had products delivered the same way. Ask your vendor if there are new options available that you might want to consider. After all, vendors make changes in their business as well!
Each negotiating point that you succeed in provides another opportunity to build the value in your aviation business. Take another look and see if you left anything behind!
