Procurement managers today are spoilt for choice when it comes to sourcing for their companies, having access to a vast range of procurement software and supply-chain technology. Nevertheless, many still prefer to go the conventional way by negotiating with potential suppliers to establish relationships and ink business deals. These meetings are usually held between the top management executives of both the buyer and supplier sides, hence the term ‘top-to-top meeting’. Essentially, a top-to-top meeting – also known as a strategic alignment meeting – is a sales strategy where a top management executive from one company sells directly to a top management executive from another company.
Top-to-top meetings were traditionally employed to strengthen business relationships between the buyer and the supplier, as well as to determine the receptiveness of the procuring party to new ideas, proposals, products. In other words, top-to-top meetings are designed to facilitate strategic alignment between buyers and suppliers, and should encourage open communication and the exchange of ideas with an emphasis on future business growth and solutions. Strategic alignment can only occur when both parties engage in a comprehensive and highly-disciplined process leading up to the meeting. Constructive top-to-top meetings between buyers and suppliers have the potential to catalyse strong profits and higher levels of productivity for both parties, highlighting the necessity for procurement teams everywhere to step up the game when preparing for top-to-top meetings. As part of the procurement team, what are some of the techniques you need to know to prepare for a highly-effective top-to-top meeting?
Get acquainted with the supplier’s company
It is not surprising to find that on average, a sales team usually enters a high-value negotiation knowing far more about the procurement team than the other way around – which shouldn’t be the case. As the purchasing party, the procurement team must take the initiative to understand the supplier’s business lines, operational facilities, expansion plans, and the company background and history. All this information is readily available on the company website, which usually also has other documents pertaining to the company. Press releases offer latest updates on major events affecting the supplier, while annual reports can be used to glean important financial information such as profitability and revenue growth, as well as information on future business plans. This material provides invaluable intelligence that will place the procurement team at an advantage during negotiations. It also helps to put the power of social media to good use by trawling the supplier’s LinkedIn page. You are likely to find some names of the supplier’s past and present customers, as well as details on the supplier’s board of directors, which can be useful when making contact. Your top management executives will be grateful for well-researched information on the suppliers they will be negotiating with during the top-to-top meeting.
Prepare a meeting agenda
As with every other meeting, a top-to-top meeting between the procurement and supplier team must have an agenda. This ensures that both sides are clear on the purpose of the meeting, and privy to the issues that will be discussed. To kickstart this process, get in touch with the supplier’s representative and offer to prepare a meeting agenda that will be circulated to all participants before the top-to-top meeting. Request for the names, titles and contact details of the top management executives who will be representing the supplier in the negotiations; a list of all the issues that the supplier wishes to discuss; and any questions that they may have. With this information – and the information on the supplier’s company that you’ve already gathered earlier – you can proceed to develop a detailed agenda. It’s important to know in advance the individuals that will be representing the suppliers in negotiations, so that the procurement team also brings the right representatives, e.g. If the supplier’s attorney will be there, you would know to bring one to represent the procurement team as well. Knowing in advance the list of issues that will be discussed gives you more time to prepare the necessary information and answers. Your top management executives wouldn’t be too happy if caught unprepared to respond to questions by the supplier. Having the list of issues beforehand also allows the procurement team to structure the negotiations in such a way that builds momentum, creates logical resolutions for key issues, and steers the negotiations toward a favourable outcome for the procurement team. Additionally, having a meeting agenda will prevent both parties from straying into other areas of discussion, thereby avoiding a long, drawn out meeting with no clear outcomes.
Understand the profile of the supplier’s negotiating team
While you may think that you’ve already gathered enough information on the supplier’s company, there is still another area of the information gathering process that requires attention: the supplier’s negotiating team. Once you’ve obtained the list of representatives for the supplier’s team at the top-to-top meeting, it’s time to put your sleuthing skills to good use. Get to know these individuals before meeting them in person. One of the ways to learn about them is through social media networks such as LinkedIn or Facebook. Take note of their educational and professional backgrounds, how old they are, where they’ve lived, their interests and hobbies, etc. Getting this information well in advance will help the procurement team tremendously when strategizing negotiation tactics. It also helps to get to know the representative of the supplier’s team several months before the actual top-to-top meeting takes place. This meeting can be structured as a get-to-know session over a casual business lunch. During this session, it’s helpful to enquire about the supplier’s top management executives who will be present at the top-to-top meeting – understanding their personality types and management styles go a long way towards securing better outcomes for the procurement team during negotiations.
Preparing for a meeting can be nerve wrecking, but if handled well it could open many doors for your business. For related articles as this, come stop by at our site ThunderQuote .
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