Some Key Questions Suppliers Need to Ask Themselves in 2022
It seems impossible, now that we’re in 2022, to have any conversation about business without discussing supply and demand. We all feel the strain and we all desperately want a solution . . . but what is the solution?
In many organizations, dramatic price increases haven’t remotely slowed demand of their products and, as a result, fulfilling these orders seems impossible. In other organizations, sales have been halted months ago, and delivery dates continue to be pushed out. Demand remains high and supply continues to run low.
Have you heard about the Avocado shortage yet? Head down to your local Chipotle. Previously, when you could typically add guac to any burrito for a little extra pocket change, now you no longer have that option. Suppliers are slammed . . . but we all still want our guac!
So, how are suppliers supposed to navigate this uncharted territory?
Transparency, data, and help from consumers.
What is your true need?
Let’s jump back a few decades and revisit the heartfelt movie, It’s A Wonderful Life. George Bailey’s bank was facing a crisis when all of his customers broke through the door demanding their money. Their demand was much higher than his supply in that moment—but his transparency and relationships with each of these individuals saved him and his business.
They didn’t truly need their money in that moment, but their fear told them they did.
Are you ordering more than you need out of fear?
If so, this is escalating our supply and demand issues. Dig into your data and your distributors data and be brave enough to have a challenging conversation.
Are you setting reasonable expectations?
In 2019, I finally ordered a rug for my dining room. I was excited to finally have one that was large enough to protect our wood flooring . . . and five days after ordering it, it was under our table.
In 2022, life is quite different. Ordering online is still common practice, but delivery dates are weeks to months out; and when you step foot into your local store, you are often met with a “sold out” sign or empty shelves. Yet, our expectations haven’t shifted. As consumers, we all still want what we want . . . now. And, of course, as a supplier, you want to deliver as quickly as possible.
Have you used your brand to educate and help set reasonable expectations?
Or maybe the better question is: Have you utilized your platforms and sales teams to educate?
Sharing data about current supply and demand issues and delivery timelines will humanize your brand; likewise, your customers will appreciate the transparency and communication.
What IS within your control?
If the global pandemic that caused our supply and demand issues taught us anything, it was that most things are out of our control. When your contracts are no longer able to be fulfilled as they once were promised, and your workforce struggles with the current state of business just as much as your clients do, it feels like there’s nothing left you can do.
Have you equipped your salesforce with the data, skills, and tools necessary to have these challenging supply and demand conversations with clients?
Your sales teams are facing difficult conversations surrounding these supply and demand issues every day. They are feeling the challenges from clients to deliver and the pressure to know the answers . . . and yet, oftentimes they don’t have them. Supporting their conversations eases their stress, increases customer experience scores, and thus retains these talented (and albeit hard to find) people you worked so hard to recruit.
Unfortunately, supply and demand issues will continue to be around for a while, but the above questions will help mitigate the impact to your business. If you need further support navigating your team through these challenges, you can reach out to Challenger.