5 Ways Multiple Vendors Can Hurt Your Business

Author, Brandon Rosenthal

The Key Takeaway: 

Total cost of ownership is a lot more than just  price.

The Deeper Discussion:

Governance and managing multiple providers, who often have little to do with each other outside of the common customer, can be challenging.

The use of multiple suppliers often results in complex supplier portfolios, which creates challenges for buyers to manage and optimize.  In response to these challenges, leading buyers rationalize the number of suppliers in their portfolio.

The truth is many people expend any and all resources necessary to build the idea and then proceed to fall apart at execution.  Most bargain shop or worse wait until the last minute to produce.  Why do you work with who you work with on these projects?

In today's environment in a few minutes you can find a random vendor online who is cheaper than the other random vendors online.


What are the real costs of this to the organization?

Here are 5 cost not included in price to remember.

 1.   Diminished Ability to Access Scale Benefits

Being a large customer has its benefits such as access to better talent, a more detailed eye on your project, and a higher level understanding of your business and its goals.  Will the discount vendor from Google really give you the best talent, attention, and product?  Generally, the answer to this is no...

 2.  High Risk

There is zero chance beyond luck of having consistent brand collateral when you source out everything to various vendors.  Color variations, product quality, and turn-times can vary significantly and do always without existing product to match.

 3.  Low Reward

Nobody is looking at your purchase order right now...honestly now, the actual product is by far the cheapest part of your budget.  How much time do you have invested? How much does your team have invested?  How much did the event cost to put together?  How much were tickets, hotels, dinners, flights, taxi rides, etc.?  What do you gain by saving a pennies per unit on the end product?  What do you loose...a lot.

 4.  Challenging Communications

Frankly, why are you trusting the results of all that work to anyone other than a trusted partner who knows what you are trying to achieve.  Where are they located again?  What language do they speak?   Communication is known as the culprit of most issues.  Having a relationship with your vendor allows you to know who to call and the security of knowing they know you and your business.  Trust is earned by working together.  If you want good advise take the time to build a real relationship.

 5.  Higher Real Cost, Lower Real Value

People seem to see a few pennies less on a estimate and miss the cost of failing to manage a product's design and manufacturing, as well as, the process plan for usage of the product after manufacturing.  Volume, Print Method, Artwork Setup, Freight Planning, Production Setup, Fulfillment Strategy, and a host of other items are critical to the real cost of a program.  Multiple vendors for branded merchandise creates a difficult environment for knowing who knows there stuff and more importantly who understands your real goals.  A single-source solution will provide a partner who actually understands the bigger picture, can help you make adjustments to your idea that will save real dollars down-the-road by utilizing existing print assets from past orders or planning for future print assets to be used for future program items you plan to produce.  A single-source relationship is not a transaction, it is a relationship that is built to better serve you and produce the best results, most efficiently, and for the lowest total real cost possible.  My personal goal with every relationship I embark upon with a client is one thing...I intend on sharing my professional experience and expertise with them to show them a way to get superior results (aka ROI) than expected, with less frustration by making the path to a better a way of doing things simple.  When I succeed, the results are significant enough to make it from the top to the bottom of the organization, and the single path to success is based on building real trust with good communication.  If you don't feel this today when making a marketing collateral or branded merchandise purchasing decision then you should question why you work with your current vendor.

Have questions for Brandon about your marketing strategy and how you may be able to streamline your branded merchandise and marketing collateral budget and/or process?  Comment below or request a consultation today.



Brandon Rosenthal VP

Effective, cross functional problem solver with an entrepreneurial mind. Expertise in digital strategy, custom manufacturing, and integrating the two so companies in any industry can become best-in-class leaders and innovators in the new digital business environment.