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Wednesday
Aug292012

The Use Of Strategic Vendors

Price isn't the only thing that you should be looking at when choosing a technology or product vendor.

So what is a strategic vendor?  I’ll get to that a bit later…   I’ve been in the business world now over 30 years with the last 8 in the medical aesthetics field.    In those 8 years, I’ve been mystified why so few vendors in this sector understand the importance of staying close to the customer.  How so few  really take the time to understand my business which although is similar to many others is uniquely mine with its own challenges.

Most vendors only come around when they have a new product, service, promotion or are on a ride along exercise with their boss and need some place to go…  Most vendors never care to ask what my goals are and very few know what I’m planning for my business this year and next 5 years.  Most only care about making the sale today and then move on to the next buyer.

Most vendors also carry with them a planned obsolesce strategy for the equipment they sell.  They expect us to plunk down $100k plus every three years for their new technology which usually is a bit faster but offers little more than the generation they want us to replace.  They try and sell us on the fact the our now 3 year old technology is now going to require a maintenance contract of $15,000 or more per year. They try and tell us that it makes “financial sense” to replace our old units because on a 7 year lease our monthly expense will stay the same. 

Then they try and close us with “and you’re going to save $15,000 per year” because they are giving us a new 3 year warranty. Then of course three years later another sales guy repeats the process even though the new laser is now 3 years old but has 4 years remaining on a lease.  Does this sound familiar…

So, what is a strategic vendor. This is a vendor that literally sits down at the planning table with you and tries to assist you in meeting your short term and long term goals. They ask question like;

  1. Forgetting who I work for and what we sell, what needs have you identified as technology shortcomings?
  2. What are your top revenue producing services today and how do you see that changing over the next few years?
  3. What are your current marketing campaigns, what are you planning in the next few quarters?
  4. What are the top three challenges facing your business today?

Strategic vendors don’t simply sell and come back every three years. In addition to taking the time to better understand our business issues and goals they go a few steps further. They put together robust consumer driven websites and brand products so patients can easily find us. 

They buy consumer billboards, place ads in consumer magazines and appear regularly on national TV shows and refer new patients back to us. They offer to provide funding for advertising that uses their product or service. They offer to let us buy advertising from the national contracts they’ve negotiated.  They offer to come in and conduct seminars for patients and conduct continuous improvement training for our staff. 

In short they work hard  and put forth programs to make sure the decision we made to invest in their technology platform is rewarded. Why? They know if they help us increase revenue we are very likely to continue to buy from them because they demonstrated through action that we matter to them for the long haul. So, tell your vendors who fall short to hit the road and look for vendors who care enough to understand your business and will work with you to help achieve your goals.

Reader Comments (5)

I'd agree with this. I'd also like to hear what everyone's list of 'recommended' vendors is as well as the vendors that I'd want to stay a way from.

08.29 | Unregistered CommenterLrgo

Great article! As a manufacturer rep I try my best to alway bring value to my customers and prospective customers. In this industry you can easily choose the wrong partner and wind up with an expensive investment that you don't get proper support for. I've seen it happen many times unfortunately.

I had not included vendors but let me add a few. Syneron has done a very good job in branding their products like VelaShape and has referred tons of leads to us from patients who visit their consumer website. They also provided co-op funds for radio ads and provide good updates on improved protocols. BTL is another vendor who although they are a smaller player provides excellent post care support. What I'd like to see is for a laser vendor to roll out a platform that will allow future upgrades to take place without the expense of replacing the core system. Lasers for most of us represents the single largest expense and there is no reason beyond greed why this cannot be done.

Hello all,
I'm a long-time lurker but decided to chime in here (anonymously of course).

@Brian, We're always open to new thoughts on how we can make our business model work better, but the truth is that we're a business like any other (read: like yours) who has a responsibility to maximize our revenues, customer base, and profits. If that's greed then we're as guilty as anyone else (read: including you). I have yet to see any clinic that charges lest for care than what they think is in their best interest. (By this I mean that you do see competitive pricing or discounts, but it's always what the business perceives to be in their larger interest in some way.)

I do think that there are ways.. creative ways.. which technology vendors could use to increase sales of retain more customers but it is a very competitive market and an entrenched system of selling. In many cases there are shareholders to satisfy.

Physicians (our target market) make decisions that are entirely self serving all of the time and are often difficult to work with because of that. They want to be last in line but get special pricing, take endless man hours of hand-holding and want to be 'bumped up' into a higher category. We understand that it's the nature of the business and we deal with it.

I guess that I mean to say that I really love this blog (I do get questions asked about posts/comments on it by docs all the time) and I like this post. No offense intended but I just don't think that buyers often understand that it's our job to extract the most money from you.... that's just good business.

08.30 | Unregistered CommenterLaser Rep

Laser Rep,

Prior to owning a MedSpa I was a former "C" level exec in the technology sectors in sales & marketing. Yes, your company and all are looking to make a profit. No harm in that. If it's just about the money however you are missing the point. In the aesthetic field while price is always important so is customer service and of course results.

Coming around only to sell your new wares without regard for maximizing existing technology will likely result in your customer looking for a better option. That model works only for so long and the point of the article was to let others know to interview your vendors not just for what they can provide you today, but over the course of lifespan of the equipment they are buying. A great business relationship benefits both parties almost equally and because of that last far longer than the I'm out for myself to make my quota approach...

09.7 | Unregistered CommenterBrian

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