Published by:
Harvard Business Publishing
Length: 9 pages
Abstract
Big retailers like supermarket chains often demand extra service from their suppliers, who are all too eager to forgive a late payment or meet "emergency" shipment demands with no compensation. Most suppliers don''t know how much these add-ons are costing them. Suppliers can take charge by tracking individual customer performance and by putting together multidisciplinary teams to manage strategic groups of customers. With internal changes in place, suppliers can then formulate a flexible, service-based pricing system that establishes appropriate incentives without alienating customers.
About
Abstract
Big retailers like supermarket chains often demand extra service from their suppliers, who are all too eager to forgive a late payment or meet "emergency" shipment demands with no compensation. Most suppliers don''t know how much these add-ons are costing them. Suppliers can take charge by tracking individual customer performance and by putting together multidisciplinary teams to manage strategic groups of customers. With internal changes in place, suppliers can then formulate a flexible, service-based pricing system that establishes appropriate incentives without alienating customers.