How do you pick a supplier or consultant?

[columbo]

Picking a supplier, consultant or just some extra-brain power for your business can be a complete minefield.

After listening to business people over the years and from personal experience, here are some things I’ve learnt.

• Those who sell themselves highly effectively can often end up being the worst partners for your business. This might sound counter-intuitive. But I’ve heard some many cases of suppliers / consultants giving extremely slick presentations to the board only to end up as complete disappointments.

• Conversely, people who present their pitch in a seemingly poor and disorganised way can end up being stellar partners for the success of your business. While their demeanor is not confidence-inspiring, they are doers rather than talkers.

• Slick websites and brochures really mean nothing.

• Sometimes, over-hyped suppliers or consultants (the ones everyone in your industry talk about) can end up being complete jack@sses and you wonder what the hell was all the hype about.

Picking a supplier or consultant is a complete minefield with loads of minefields and traps. What criteria do you use to pick one?

 

[Mr D]

Research. They have to meet whatever criteria I'm looking for in product or service.

 

[SillyBill]

Pretty much all of the business I do comes from word-of-mouth, referrals etc. Pretty much all of the business I do with others comes from word-of-mouth, referrals etc.

If I need something doing I'd call X and they'd put me onto Y. Best advertising is being good at your job, the word gets out.

 

[Clinton]

Those who sell themselves highly effectively can often end up being the worst partners for your business. This might sound counter-intuitive. But I’ve heard some many cases of suppliers / consultants giving extremely slick presentations to the board only to end up as complete disappointments.

Couldn't agree more! In my industry, the slick business brokers and hard selling, pushy brokers are the most useless. KBS, the UK's largest business broker, talks a good talk but successfully sell only about 5% of the businesses they take on!

But, how do you find the right adviser? This is a very interesting question and in my industry I solve it by charging a lot of money to do the finding on behalf of business owners! Word of mouth is just not available and, in any case, even if you do know someone who got good service from a particular business broker, that broker might have been right for them but not right for you.

The larger the stakes the more time and effort you need to spend to ensure you're getting the right expertise. So, for example, if you're looking to buy a plane for your charter service, you'd spend weeks in research and spend tens of thousands to buy data in - hanger costs at different locations, landing fees, insurance costs, operating costs, whatever.

For some decisions the data is available or can be bought in. For other big decisions, the data just doesn't exist anywhere. That's particularly so in my industry when someone wants to sell a larger business (£5m+ in t/o). The typical sign-on fees with advisers is circa £30K to £50K but it takes a whole lot of knowledge, experience and savvy to find the right one ...and business owners don't have that expertise. For many it's the first time they're selling a business and they are clueless about how to vet the professionals.

But for those who don't want to pay my fees I put together some advice on how they can go about finding the right expertise in an area where they know nothing and where the data they need is not freely available. The article was published on a legal network if anyone's interested. Some of it might be applicable in other industries as well.

 

[MOIC]

Due diligence

Referrals

Communication

Test before proceeding

 

[Mark T Jones]

Recommended by trusted source

ask challenging questions rather than making big promises

don’t dive in with smart’ clioses

Don’t pressure to sign

 

[Financial-Modeller]

Actual relevant demonstrable experience helps!

Anybody can promise that they might/could/potentially be able to design/plan/conceptualise something, during a pitch to a potential client.

An experienced supplier or consultant will be able to say:

I/we have actually delivered something relevant and valuable to a similar business/competitor/supplier/customer etc and they will be happy to confirm this. I/we can do the same or improve upon it for you.