B2B Reciprocity

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  • #292181

    Our sales team would like us to give more consideration to current clients who also sell goods and services relevant to our company.

    1. How does your organization set a reciprocity policy to ensure a fair and legally sound selection of suppliers? Will you please share your policy regarding reciprocity?

    2. How does your organization engage its critical customers who also have the potential to be suppliers?

    3. How do you coordinate with your sales teams to ensure Sourcing and Sales are aligned on strategy?

    #293395
    Anonymous
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    • Being a customer matters; we want to invest in our communities.
    • All else being equal (capability, pricing, operational controls, etc.), the diverse supplier or customer wins.
    • A member of our sourcing team has access into customer profitability systems to look up the net margin on a customer and to pull SIC codes for inclusion of customers in RFPs; in addition, our prospective supplier questionnaire links to the Ariba Supplier Network instance used to pull prospective suppliers for RFPs – in that questionnaire, we inquire about the customer relationship.
    • When a customer is involved in an RFP, or we are terminating an relationship with an existing customer, we include the relationship manager in discussions prior to delivering the notification so they are aware of the decision
    • We are a resource for our business segments when they inquire about whether we are doing business with a customer or prospect before their sales call
    • Be aware of the code of conduct for your company and the integrity of the sourcing process and confidentiality restrictions on the information you share with internal resources, suppliers, customers or prospects; also be cognizant of any regulatory prohibitions against linking the customer and supplier relationships.
    #293397
    Anonymous
    Guest

    As as a Utility providing energy services (electric and natural gas), many of our Customers also have the opportunity to be our Suppliers. Reciprocity comes up occasionally either from internal marketing groups or from the Customer themselves to our senior management. As an investor owned Utility, we are governed by our State’s Utility and Transportation Commission (UTC). As such, we and the UTC represent “all” of our customers to be sure that compliance and due diligence are met in transacting business. That being the case, we consider the transactions of selling energy to our Customers and buying from our Customers as Suppliers as two separate transactions with no preference given for being our Customer. Bids and purchases are completed on total value and merit. However, as you know, there are savings in purchasing from a Supplier that understands your company well and carries local stock which saves on transportation costs, plus the benefit of same-day delivery. As a Utility we seek to be the best energy provider our Customers desire. As a Customer, we seek to be the best Customer our Suppliers desire. Keeping Customer and Supplier transactions separate lets us focus on meeting compliance and due diligence requirements easily and above board without any question as to motives.

    #293398
    Anonymous
    Guest

    * * * Due to legal considerations…very carefully! * * *

    #293399
    Anonymous
    Guest

    1. How does your organization set a reciprocity policy to ensure a fair and legally sound selection of suppliers? Will you please share your policy regarding reciprocity?

    When I was in procurement, we didn’t have a standard policy. My team lead was a visionary , so started talking and using reciprocity for our team negotiations.

    2. How does your organization engage its critical customers who also have the potential to be suppliers?

    It worked out naturally for us.. we are a telecom, so by default someone was already doing business with us (ie using OUR services) before we ever started using them as a potential vendor

    3. How do you coordinate with your sales teams to ensure Sourcing and Sales are aligned on strategy?

    • When we issued RFPs for our services,
    • I would pull the annual spend out of our spend analytics tool (ARIBA in SAP) to see how much vendor X spends with us.
    • I’d engage the Sales Specialist ( always difficult to find in an organization our size, thankfully we had a somewhat working internal directory mapping companies to their sales representative on our side )
    • I’d let the Sales Specialist/ Account Manager know that we are looking to do business with vendor X now, so that they know that we are building a parallel relationship
    • We’d use the carrot of the RFP as a negotiation chip- ie hey Vendor X you want our business, well why don’t you increase your existing telecom services spend with us too?

    Sometimes it worked, other times, if the company already a) was tiny b)had all their business with us c)was tied to another telecom in a contract for years – then we know we tried, and we’d really have to then decide if their services were completely unique and if we could or could not get those elsewhere; and award RFP accordingly.

    What this has done is that over the years, Sales has learned to come to Procurement ( I still get emails, years out of the role) asking if we have a contract in place with company y/z- so that they can use the services contract negotiation as THEIR chip in sales to sell more telecom services. So for us, it works both ways.

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