The featureless stare of my manager. It conveys a mixture of disappointment, unhappiness and it’s my cue to prepare for an interrogation.
“What do you mean there’s a cost increase? Have they taken into account our growth?” “Yes”
“Have you told them to view their efficiencies?” “Yes”
“I’m not taking currency collapse as an excuse” “I know”
“Have they reviewed every aspect of their own supply chain” “Yes”
“Well, tell them we aren’t accepting the increase” “I already have”
Generally speaking, these are fair questions, and are in every good buyer’s repertoire. And believe it or not, whenever faced with the prospect of a cost increase, the account manager is feeling just as bad at having to deliver the news, as you are having to accept it. Probably.
But, there does come a point when the ammunition is exhausted and all you’re left with is begging for a better cost.
My manager, Mr. Price, is a director of the business and an ex-supermarket buyer. Hard nosed, straight talking, never afraid of having a fight with a supplier. Cost is paramount, and any hint of a better deal elsewhere is sniffed out like a rabid bloodhound.
Expensive shirts, expensive watch, expensive car, the outer image conveys someone who values the finer things, and is, partly, a bit of an act to show suppliers who’s in charge. In meeting mode, he is exactly how you would imagine a buyer to behave – blunt, scathing and unsympathetic.
I recall a time recently when faced with a price hike from a long term supplier, Mr. Price simply ended the meeting by bluntly telling them to “put someone else’s price up to offset the increase; I don’t care how you do it, I am not taking it”
One downside to this style is, unfortunately, when you have to tell him bad news – You then play the part of the supplier and bear a full onslaught of inquisition. On occasion, the ‘shit sandwich’ approach to unpalatable bulletins has to be deployed.
Good news (the bread)! Bad news (the shit). Good news(bread)! I think I read somewhere that Gordon Brown’s staff used to use this technique with regularity.
My approach is slightly more empathetic. I come from a different background, starting my career with wholesale purchasing and then project procurement, where building relationships with suppliers is very important.
When involved in large scale construction projects, one is always pulling in favours, changing delivery dates, changing product specifications and battling with architects and designers. Price starts to lose its relevance (although still important of course) and simply completing projects on time becomes the focus.
Although slowly, especially with the current economic challenges, my attitude is becoming more and more convergent with Mr. Price. I simply don’t have the time or budget to have conversations which start with “Well, we all know it’s tough trading out there…”
Having said that, the reality is that sometimes there really is nothing to be had, and little choice but to accept higher costs.
I guess the overall point of today’s musings is that no matter what approach a buying team has, mine, or Mr. Price’s, the current economic climate, one of the effects of Brexit, is unfortunately going to mean higher prices for everybody.
Our currency is shockingly weak and eventually leaving the single market will mean higher importation costs. Thats without even pondering the effects that staff at the lower, but important, end of the salary spectrum are going to have to be paid higher to ensure supermarket shelves are stacked, restaurant tables are cleared and hotel rooms are cleaned. The European free movers, starting their UK careers aren’t going to be here to take up those roles.
So, who’s going to pay for all this? All of us.
So when you’re wondering why you’re paying what you’re paying for your ready meals at home, your pizzas on date night out and your dirty weekend away, just think of the efforts the procurement teams across the country are still making to let you pay as little as possible…
And I always try and let our suppliers provide this with, at least, a half smile on their face.