Key Takeaway: When a supplier has to choose who gets priority during a shortage, it's rarely the customer who negotiated the hardest on price. It's the one who's been easiest and most reliable to work with.
What's on This Page
What Makes You a Good Customer
- Paying on time, every time, not just when convenient
- Giving realistic lead time on orders instead of constant rush requests
- Clear, prompt communication when there's an issue on either side
- Growing, predictable order volume over time
Why This Pays Off
During a supply shortage or capacity constraint, suppliers allocate limited stock to the customers they trust most and want to keep. Not necessarily the largest account, and rarely the one that's been difficult to work with. Being a genuinely good customer is a real form of supply chain insurance.
Balancing Relationship and Negotiation
A strong relationship doesn't mean never negotiating. See Supplier Negotiation for how to negotiate firmly without damaging the relationship that makes negotiation possible in the first place.
For further reading, see the Association for Supply Chain Management (ASCM).
Checklist
- Identify which suppliers are critical to core operations
- Avoid single-supplier dependency on key items where feasible
- Communicate order forecasts ahead of time, not just at order time
- Pay on agreed terms consistently to build trust
- Review key relationships periodically, not only when problems arise
- Document what makes each key relationship valuable beyond price
Common Mistakes
FAQ
Why treat supplier relationships as strategic rather than purely transactional?
A supplier who understands the business's needs is more likely to prioritize it during a shortage or offer flexibility during a cash crunch.
How many suppliers should a small business rely on per key item?
At least two where practical, since single-supplier dependency creates real risk if that one relationship breaks down.
What builds a strong supplier relationship beyond price?
Consistent, honest communication, paying on agreed terms, and giving realistic notice on order changes.
Should key supplier relationships be reviewed periodically?
Yes, alongside scorecard and performance data, to catch a relationship that has quietly become one-sided or risky.
Calculate This For Your Business
Related Guides in the Supplier Academy
- Supplier Negotiation. negotiating without damaging the relationship
- Supplier Risk Management. protecting against relationships that go wrong anyway
- Supplier Management Guide. another guide in the Supplier Academy