Business-to-business relationships often require good faith arrangements. Due to a lack of up-front funds, suppliers like you must extend trade credit to maintain B2B partnerships.
However, when you enter into trade credit agreements, you place yourself in a vulnerable position. With too few regulations and security measures, these arrangements are risky.
Issuing more than $1.3 trillion in trade credit annually, Australian suppliers stand to lose a great deal.
While the credit system is vital for buyers, it requires a great deal of trust from you, the supplier Aside from incorporating better systems and protections, you need to invest in relationships.
Benefits of Improved B2B Relationships
Business relationships usually come down to customer service, but the service part of the relationship can sometimes grow muddy.
Often, suppliers and buyers can get caught up in the assumption game: the supplier assumes the buyer doesn’t need special attention, and the buyer assumes the supplier doesn’t need feedback. Both are wrong, of course.
As a supplier, your customer is the buyer. The buyer contributes to your success and brand awareness.
Additionally, you provide your buyers with a service they need to survive and thrive. Both parties can benefit when the relationship is sound. Some of the more prominent benefits include:
- Increased leads and sales
- Reduced customer turnover
- High-value feedback
- Loyalty
Ways To Improve B2B Relationships
In a typical business-to-consumer relationship, it is standard to focus on group demographics.
A business determines its ideal clients and caters to that target market. While the same principle applies to B2B relationships, the symbiosis requires closer inspection.
The supplier and buyer arrangement is more interdependent than B2C relationships.
As a supplier, you need to focus on a more targeted audience, which typically has fewer potential customers. Also, the buyer may not have many options for fulfilling their needs. Therefore, each party is life support for the other.
With the high stakes between businesses, improving relationships is critical.
A supplier or buyer with a maintained and healthy relationship has fewer concerns. Still, establishing a mutually beneficial relationship takes work.
1. Resolve Pain Points
Business-to-business consumers tend to stay with a supplier as long as they are happy.
A buyer’s unhappiness can stem from pain points in the existing relationship. Common pain points tend to involve four specific areas:
- Productivity
- Finances
- Process
- Support
As a supplier, you want to focus on relieving as much pressure on your clients as possible. You can identify specific pain points for each client by:
- Asking for feedback
- Looking over client reviews
- Talking to your sales team
- Surveying clients
While surveys are helpful tools, not every client is willing to take them. You can improve the participation rate by offering incentives, such as discount codes.
2. Think of Relationships as Partnerships
When you only look at a buyer as a consumer, you might underestimate their value to your business. It is best to view buyers as partners.
A partnership encourages loyalty and a deeper bond. Through collaboration, B2B partners can establish mutually beneficial relationships.
While all buyers are valuable, some are more valuable than others. Look for loyal customers, those committed since the beginning, and pull them into the fold.
Invite these customers to participate in brainstorming sessions, meetings, or other events. Their insights can help each business thrive.
3. Outperform the Competition
Competition is a reality of business, regardless of the market or operation. Buyers will sift through competitors’ offers to find more valuable arrangements.
As a supplier, you need to focus on the competition. You must mitigate client losses by remaining a more advantageous partner.
If your competition cuts costs, examine your operations for areas where you could save money, allowing you to also reduce prices.
If you cannot meet competitor prices, make sure you offer something of greater value.
The best way to remain the star in your buyers’ eyes is to cater to them specifically. You can outperform the competition by focusing on your clients’ individual needs.
A satisfied client is less likely to abandon a quality relationship, even when better deals are available elsewhere.
4. Listen More
Communication is a vital aspect of every relationship, professional and personal. In business relationships, you must often walk the line between friends and business partners.
B2B relationships tend to become long-term connections, and it’s easy for one side to become complacent with their level of communication.
Though you may be accustomed to a buyer, you still need to inquire about feedback or needs. While long-term relationships contribute to success, remember they take work.
You cannot resolve pain points or ensure buyer satisfaction without communication. You need to ask questions and show that you hear the buyer. Always try to involve the buyer in decisions that affect it.
5. Focus on Personalization and Specialization
A buyer wants to feel important to you, the supplier. The key to making a client feel valued is personalization. Every buyer is a business, but the business is a collection of people.
You can make buyers feel appreciated by using names to address companies. For example, instead of addressing a letter to the Hardy Bean Coffee Company, address it to George Mitchell, CEO of Hardy Bean Coffee Company.
Additionally, you can use purchase histories to predict what programs or sales that can benefit your buyer.
Tighten your business strategy by specializing in an industry or service. Specialization can help you establish a niche, which can improve customer relations.
B2B Relationships Are Crucial to Sustained Success
Your growth and sustained success as a supplier depend on stable, long-term B2B relationships.
By taking on significant risks through trade credit agreements, you acknowledge the importance of accommodating your buyers and maintaining supplier-buyer relationships.
Improving business relationships is crucial to managing supplier risks. However, you need to do more than focus on reworking internal operations with the above suggestions.
Despite the unregulated and unsecured trade credit market, there are ways to reduce your risks without hindering buyer relationships. Book a demo with us for more information.