Major Leagues

Building relationships is key to success in the world of suppliers and subcontractors. Indeed, once you get into the supplier system, you're likely to find an entirely different animal from the one you may have heard about. The old relationship between buyers and suppliers was adversarial at best, recalls Rene Yates.

"The old thinking was buyers are out to do you in, and you kept them out of your plant," says Yates. "Now, they're in the plant designing products with you."

Trust is now a major part of any buyer-supplier relationship because corporations realize their suppliers can help them gain a competitive advantage in the marketplace, continues Yates. Entrepreneurs must become comfortable with such closeness if they want to develop a long-term relationship.

These relationships pay off in more ways than one. Some corporations have special supplier development programs aimed at grooming smaller companies. At Dupont, for instance, the Supplier Development Program can provide services including finding someone at Dupont to assist with the supplier's marketing, providing software and technical support to give a company electronic data interchange (EDI) capabilities, and offering training workshops for suppliers on subjects such as strategic cost management.

At Sprint, Smelcer says, "If we find a company that has potential, we work with them to bring them on a little at a time understanding how to do business with Sprint--what level of performance they need to be at and what Sprint's standards are."

Whatever route you take to sell to the private sector, there is one thing to keep in mind: Knowing your market can get you in the door, but providing good quality and top-notch service coupled with competitive pricing will help you win the contract.

This article was originally published in the January 1997 print edition of Entrepreneur with the headline: Major Leagues.