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View Full Version : Had To End A Business Relationship Today



VeeJay
7/13/2006, 01:39 PM
We've had this particular supplier doing business with our co. since before I got here. This supplier is basically a one-person operation, and serves as a "middleman" and actually owns no facilities, equipment, etc. Everything he sources from other people.

Lately, the last few months, the quality of goods he is delivering to us has been horrible. He deals in low priced products, and is basically a shoestring operation. I found out this morning that he owes several producing companies thousands and thousands of dollars. In fact, one thing that brought this about was that our purchase order was not going to be shipped due to his non-payment. So my goods were held up at a loading dock.

So the guy who owns the plant came to us this morning to explain what the deal was, and offered to do business with us directly, resulting in the cutting out of this middleman, and saving us around 20% on the cost of product.

So I had to call the middleman, an older guy in his 60's, and tell him to cancel all our backorders, and that we have elected to no longer do business with him. That involves a lot of busy work on our side, approving a new supplier, changing labels and designs, etc. But the hardest part was telling this old guy he's out of business.

He's called me three times already, since then, saying anything possible to salvage his business. But, it's the same story - everything is always the fault of someone else. The bottom line is, the quality of his product (bottled water) hasn't improved and we've been patient with him and stood by him (and listened to his excuses) for about three months.

One thing that cemented this decision was the call last week I got from the older guy yelling and screaming at me (I'm the customer), because of things our logistics people did that HE claims caused damage to his product. We billed him several thousand dollars for all the accumulated damaged or unsaleable product, and he went ballistic when he got the bill. For this guy not to even have $2500 available as an open line of credit for his business is not someone I need to be screwing around with.

I hate to put a nail in this guy's coffin, but on the other hand my life should improve now that I won't have his problems as my problems.

soonernation
7/13/2006, 01:46 PM
If all you are doing is cutting out the middle man how is this going to help the quality of the products. Aren’t you getting the product from the same place he did?

XingTheRubicon
7/13/2006, 02:30 PM
http://img420.imageshack.us/img420/8830/glue8ss.jpg (http://imageshack.us)

jkm, the stolen pifwafwi
7/13/2006, 02:56 PM
http://img420.imageshack.us/img420/8830/glue8ss.jpg (http://imageshack.us)

why do you hate barbaro?

mdklatt
7/13/2006, 03:20 PM
Did you PIITB before breaking it off?

Wait...wrong kind of relationship. Never mind.

CatHunter
7/13/2006, 03:25 PM
We've had this particular supplier doing business with our co. since before I got here. This supplier is basically a one-person operation, and serves as a "middleman" and actually owns no facilities, equipment, etc. Everything he sources from other people.

Lately, the last few months, the quality of goods he is delivering to us has been horrible. He deals in low priced products, and is basically a shoestring operation. I found out this morning that he owes several producing companies thousands and thousands of dollars. In fact, one thing that brought this about was that our purchase order was not going to be shipped due to his non-payment. So my goods were held up at a loading dock.

So the guy who owns the plant came to us this morning to explain what the deal was, and offered to do business with us directly, resulting in the cutting out of this middleman, and saving us around 20% on the cost of product.

So I had to call the middleman, an older guy in his 60's, and tell him to cancel all our backorders, and that we have elected to no longer do business with him. That involves a lot of busy work on our side, approving a new supplier, changing labels and designs, etc. But the hardest part was telling this old guy he's out of business.

He's called me three times already, since then, saying anything possible to salvage his business. But, it's the same story - everything is always the fault of someone else. The bottom line is, the quality of his product (bottled water) hasn't improved and we've been patient with him and stood by him (and listened to his excuses) for about three months.

One thing that cemented this decision was the call last week I got from the older guy yelling and screaming at me (I'm the customer), because of things our logistics people did that HE claims caused damage to his product. We billed him several thousand dollars for all the accumulated damaged or unsaleable product, and he went ballistic when he got the bill. For this guy not to even have $2500 available as an open line of credit for his business is not someone I need to be screwing around with.

I hate to put a nail in this guy's coffin, but on the other hand my life should improve now that I won't have his problems as my problems.

How much are you paying a bottle? I got it down to 28 Cents.

1stTimeCaller
7/13/2006, 03:26 PM
uh oh, purchasing department smack!

VeeJay
7/13/2006, 03:31 PM
Heh!

The old guy had been using the new plant for only about three weeks, and he went to the new plant after he'd racked up thousands in unpaid debts to other plants around the area. The new plant is operated by someone new to this particular business, so he has patiently working out details of our needs while keeping us in business - and there had been "bumps in the road."

I met the new guy this morning - remember he wouldn't release my product to the old guy because the old guy wasn't paying his bills. The old guy has used at least three plants in the last three months, so there's been no consistency and no business loyalty or relationship building on his side, therefore the lack of quality. That has a lot to do with it, but not everything.

I was impressed because the new guy came to us today to explain the situation (as far as us not getting product), and I am all too familiar with what he said, regarding the old guy. He was above board with me, very easy to talk to, and a smart negotiator. And he wants our business. He knows a co. our size will pay its bills on time, and he wasn't getting that from the old guy.

As far as quality, that was a big part of our discussion today, and we were able to develop an action plan to address some of our complaints that weren't getting addressed through the old guy. The simple fact we now have an open line of communication with the producer of the product will help immensely. We ironed out all our concerns and this new guy is only happy to oblige and improve in order to keep our business. If things do not work out as we hope, we have an alternative, and that is to use slightly more expensive packaging. Whatever works.

Now, I really have spent too much time on this fubar today when I could have been looking at thongs in the office.

VeeJay
7/13/2006, 03:33 PM
How much are you paying a bottle? I got it down to 28 Cents.


Currently $0.43.

Can you give me 60 days payment terms?

CatHunter
7/13/2006, 03:34 PM
uh oh, purchasing department smack!

BUYERS RULE!!!!111!!

CatHunter
7/13/2006, 03:35 PM
Currently $0.43.

Can you give me 60 days payment terms?

I'm not selling, I was buying. I forget, where are you?

Taxman71
7/13/2006, 03:38 PM
Business is business. You gave him fair warning. No need for you to hold his sinking anvil when he was going under anyway. Besides, bottled water isn't something I would ever to sacrifice in terms of quality. Toiler paper, maybe, but not something going down the hatch.

mdklatt
7/13/2006, 03:40 PM
Besides, bottled water isn't something I would ever to sacrifice in terms of quality. Toiler paper, maybe, but not something going down the hatch.

Cheap TP is not okay! :eek:

1stTimeCaller
7/13/2006, 03:42 PM
beware, Taxman sells John Wayne TP.

Taxman71
7/13/2006, 03:44 PM
Real hetero men use sandpaper. Double-quilting is for those who sit to pee.

jkm, the stolen pifwafwi
7/13/2006, 04:20 PM
Cheap TP is not okay! :eek:

the kind that tears or the the kind that tears you?