Why a Positive Dealer to Landscape Contractor Relationship Is Key to Success
—
The Content Team,
HALSTEAD.
“It’s a common misconception that money is every entrepreneur’s metric for success.
It’s not, and nor should it be.”
-Richard Branson
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While the world has become more digital than ever before, there are many aspects of the landscaping industry that still depend on meaningful offline business relationships. For the average lawn or landscape contractor, creating a strong relationship with their local suppliers is crucial for job efficiency and maintaining a competitive advantage in their service area.
Dealers are in a position where they interact with numerous manufacturers, designers, installers, local contractors, and homeowners on a daily basis. When valued and nurtured, this extensive network can be incredibly beneficial for both parties in the dealer and landscape contractor relationship.
In reality, dealers are the “hub” between consumers, whether they be homeowners or business owners, and the contractor. Consumers go to the dealer to research products, to learn more about their project, and often to look for contractor recommendations.
Lose the Battle, Win the War: Leave the 5 Cents/Sq.ft on the Table
From referrals to concierge customer service to logistical optimizations, it’s undeniable that the dealer can impact the lives and business success of lawn and landscape contractors, for better or worse.
Because the margins on the landscape construction side can be thin, proper delivery and product management are critical. As any project manager or owner knows all too well,just a few loads of stone not arriving on time can mean three employees stuck being far less productive than planned or estimated for. And the wrong paver or wall products being delivered to a job site can mean a whole lot worse than just a few hours of productivity downtime—including a delayed project completion date for the end customer.
Even with knowing this, you will see a large number of landscape contractors willing to go to blows with their dealer over 5 cents per square foot on something like paver pricing. They see the dealer’s price at $3.30/sq.ft. and try to get them to lower it to $3.25/sq.ft. Many contractors will even bounce around local dealers and try to pit them against one another in a pricing war, rather than solidifying their loyalty to one and working together!
In a win-win contractor-dealer relationship, the contractor gives up the 5 cents he’s fighting for now, andthe dealer would be in their court that next time around. For example, when the product for an upcoming project comes in damaged, the dealer will remember this previous interaction, rush order more, and probably even round out the truckload with other stock products.
While there are many upsides and success stories of negotiating prices, there can be serious downsides as well. There’s a name for this kind of negative negotiating: positional bargaining. Positional bargaining rewards stubbornness and power-play, it often results in negative outcomes, and it risks doing permanent damage to professional relationships. Most importantly, positional negotiating can cause you to miss out on more valuable opportunities! In other words, this type of negotiating traps you into focusing on who gets the biggest piece of pie instead of using your creativity to figure out how to make a bigger, better pie.
Perhaps the most dangerous part of positional bargaining is that it tricks you into thinking that doing business with your industry peers is a zero-sum game, that if you gain something the other party has to lose something in return. However, in the vast majority of negotiations there is more value to be created than just “winning” the price.
Why a Strong Dealer to Landscape Contractor Relationship Is Essential
Increased Referrals
Most dealers and suppliers do their business via an outdoor supply room that homeowners can walk through, choosing products and materials for their walkways or paver patios along the way. Since dealers don’t install the products themselves, they usually provide recommendations for landscape contractors to do the work.
Foster a thriving relationship between your landscape company and the dealer, and those potential customers are far more likely to be sent your way. Again, sacrificing loyalty to your company’s dealer for a one-time 5 cent discount is not worth sacrificing this cycle of success.
Imagine what happens when a new customer goes to a dealer because she has an upcoming poolscape project and is looking for a contractor. You can bet that the dealer remembers the contractor that never haggles over pricing and pays their bills net 30.
Positive Local Business Branding
A recent study showed that 68% of consumers prefer to buy local when possible or convenient. Working with a local dealer boosts your brand’s commitment to supporting your local community and economy, earning the respect of potential customers.
Increased Efficiency
When a positive relationship exists between landscape contractors and dealers, the contractor can always rest assured knowing that a dealer is handling their products correctly and efficiently. Even a couple of minutes inspecting an order can make all the difference in whether a project gets finished on time. In the landscape and outdoor living industry, even the slightest mistake can result in the biggest setback. And that wastes money for everyone. A strong relationship with your dealer is an extra safeguard against those costly mistakes.
Competitive Advantage
When contractors partner with one main dealer, they maximize their buying power. And when there is a mutually beneficial, respectful partnership, it’s much more likely that the dealer will step up and sharpen their pencil to help you—and them—seal the deal on occasion. So when that really perfect project comes along, and you need a little extra wiggle room to beat out a competitor, you’ve got a loyal supporter in your court. Why? Because you haven’t asked for the discount on every order over the past year.
Valued Communication
Fostering a positive relationship with your suppliers does not mean the same thing as bending over backwards to please them and ignoring all issues. One of the many benefits of a strong relationship with your dealer is that it establishes trust that goes both ways. Because of that trust and honesty, you are able to address any concerns to ensure that the best service is provided. In a strong relationship, voicing concerns will not lead to losing the dealer.
In almost all business negotiations, whether it’s resolving conflict with a customer, convincing others of a change in policy, or agreeing on a budget, there is a lot more at stake than getting the last word. Because, let’s face it, chances are strong that you’ll have to continue to work with the other party moving forward.