Managing Supplier Relationships
As dispensary margins shrink, we need to look at other ways to improve the bottom-line; having strong supplier relationships based on a developed strategy is vital in achieving this.
The key points to supplier relationship success are:
- Identify your core pharmacy business and strategy
- Classify your suppliers into Gold (based on sales in your signature categories) Silver (priority categories) and Bronze (basic categories)
- Link and build supplier relationships and partnerships based on your strategy
- Ensure you plan for supplier meetings and set an agenda based on “The Pentagon”.
Product: Does the product or range fit in your business strategy? What are the ranging requirements? Is it a core or opportunistic range? Is the product sale or return?
Place: Where does the product sit in the current planogram (one-in-one-out policy)?
People: All Staff must be trained – Non Negotiable!!
Promotion / Communication: Coop Support available – lock in your yearly marketing calendar. In-store theatre – Windows, display ends, counter units, bin strategy. GWPs or other offers?
Price/Value: Not necessarily the lowest price, but the best value – service value position. Consider product discounts and parcel buys and PDE terms Vs turnover.
Ensure you “win” on each of these with suppliers to maximise GP and sales potential.
Nicole Hooley, Retail Projects Manager