What to Demand from Suppliers
Business owners know instinctively that they need to focus on certain areas: providing great customer service, for example, as well as marketing their products and managing their people. Managing vendors is often overlooked. However, selecting the correct vendors can have a major impact on your profitability. Because your vendors provide the ingredients that are key to your business, you need to expect the same level of quality and commitment out of them that your customers expect from you. Building a solid relationship with your vendors can help ensure your shop’s long-term prosperity.


Vendor selection
For products that are part of your cost of goods sold, quality is essential. Buying inferior goods can lead to selling a lower-quality product to your consumer and lowering revenues in the long run.

When selecting a vendor, ask candidates to provide references. This is not an unreasonable request. When checking references, make sure you have a list of questions ready to ask. Some important queries you may want to make:

Looking at reliability and capacity is also important. If your vendors are operating near their existing capacity, it’s important to understand their growth plans. If they are unable to continue to deliver their existing products due to capacity constraints, you may want to reconsider your supplier situation.

Today’s most successful vendors look at the relationship with their customers as a true partnership. They want to see your business succeed as much as you do. The more of their product you sell, the higher their revenue and long-term profitability. Vendors may enhance their relationships with their customers by providing training and information to boost product knowledge. The more information a coffee roaster can pass on to its customers, the easier it will be for retailers to sell the product. Common guidance can include barista workshops, coffee cuppings and business training.

If a supplier takes the initiative to help your business, you will likely be more apt to stick with that company, even if you go through a business downturn. A vendor can develop its relationship with you in a variety of ways: The company might assist with marketing collateral, give guidance in business planning, help you understand best practices within the industry or provide references to other products you may need. A strong primary vendor can be invaluable to a small business.

Negotiating with your Vendors

When choosing a vendor, try to find three companies that sell a similar product. This will allow you to see the strengths and weaknesses of each company. Think about the area most important to you. Is it price? Additional services? Quality? Do they charge a delivery or shipping charge? If the vendor is a food supplier, make sure you sample a wide array of products to get an understanding of the range the vendor can offer you.



If possible, get a tour of vendors’ manufacturing facilities. Understanding what goes into making a product can help you understand their costs. In order to create a long-term relationship with you, the vendor will need to maintain a profit as well. By understanding what it takes for your vendor to produce a product, you can help come up with a price that is profitable for both sides. 



Another smart move is learning to negotiate terms with your vendor. Many suppliers will work with their customers to find a reasonable payment schedule. A typical arrangement is “net 30,” which means that you must pay your vendors within 30 days of receiving your product. It’s always better to set terms like these than to pay cash on delivery. Often you can sell the product before you pay your vendors, and if you’ve negotiated smart terms, you’ll be able to optimize your cash flow and lower your debt.



Some companies also will offer discounts with their terms. One popular setup is called “2 percent, 10 net 30.” This means the payment is due in 30 days, but if you pay the invoice within 10 days you get a 2 percent discount. Such an arrangement can create an optimal solution for you and your vendor. Your vendor gets the assurance of payment and an extra 20 days of cash flow, and you save money by paying early. A helpful trick: If you take your time and look into several vendors for a product, you’ll have an easier time asking for terms and discounts because the vendor on the other side of the bargaining table will know that the competition is lurking.



The important thing to remember when choosing vendors and negotiating with them is that they’re in business just like you are. They need to make a profit to survive, but you should make sure they aren’t overcharging. It’s also important to remember that there are many suppliers out there for most of your products. If negotiations don’t go well with one company, look elsewhere for a vendor that better meets your needs. At the end of the day, you want a vendor that provides quality products or services and is willing to work with you to ensure the best possible experience for you and your customers. When choosing a vendor, try to find three companies that sell a similar product. This will allow you to see the strengths and weaknesses of each company.

Coffee Roasting Overview + Concepts 1-Day Workshop
Next Session August 14

Do you want to learn more about what it takes to roast excellent coffee? Are you thinking of adding craft roasting to your coffee bar, or want to take your coffee education to the next level? The Coffee Roasting Overview + Concepts Workshop is the perfect introduction to the world of coffee roasting and will provide you with a great overview and theory of what is involved in micro-roasting coffees from around the world. A great entry-level workshop for coffee retailers, barista, enthusiasts and home roasters.

Workshop Overview

Roasting Equipment

• Exploring differences in types of Roasters: Fluid Bed/Drum
• Transfer of heat within each system
• How dynamics of each roaster affects the results in the cup: Basic Acidity/Body/Flavor understanding and how roast time affects these balances
• Economics/ Maintenance

• Storage
• Detecting Age

• Roasting theory from Brazil to Bali and everything inbetween
• Regional differences including Regional Characteristics, Bean Density, Elevation, Processing Methods

• Discussion of Espresso Blend evolution
• Regions: role in blending
• Concepts of Pre-Blending vs. Post-Blending

Cost
$750 for the each attendee. $500 for those registered for the 5-Day Business + Barista Workshop immediately proceeding or following this Workshop each month.

Workshop attendees receive a copy of The Coffee Cuppers' Handbook by Ted Lingle and Home Coffee Roasting by Kenneth Davids.

Click to REGISTER ONLINE. Call 800.655.3955 to register at the reduced 5-day Day Business + Barista Workshop rate.

About the Instructors

Justin Johnson is the former green coffee buyer and head roaster of World Cup Roasters in Portland, Oregon. While with World Cup, he applied his passion for roasting and his love of espresso blending and won Karnataka Plantation Indian Coffees 2007 Espresso Blending Challenge. He is actively involved with the planning of Northwest Roasters Groups educational courses and does on-site roasting consultation for both air and drum roasters.

Brandon Smyth first worked at a small roastery 12 years ago and has been in the specialty coffee industry ever since, traversing the West Coast while working at the most prestigious cafes, coffee importers and small batch craft roasters, including Stumptown Coffee Roasters in Portland, Oregon. He is accomplished roaster who has roasted several of the most expensive and unique coffee varietals in the world. Brandon has continued his pursuit of roasting knowledge through the rebuilding and installation of several vintage coffee roasting machines. He is an owner, head roaster and coffee buyer for Water Avenue Coffee Roasters in Portland, Oregon.