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Vendor Partnering: it just makes cents.
Tim Dehncke, Director and Sales and Marketing
In today’s economic environment, partnering with the right vendor (the first time) is a must. Retailers do not have the budget for costly errors made by over-promising, under-delivering vendors; any reduction in costs is more important than ever from a business standpoint. Whether it is through the awarding of a multi-site project or a 2-year Service Agreement Contract (through an RFP process), selecting the right vendor just makes cents. Selecting the wrong vendor could potentially cost additional monies, wasted time and missing an all-important deadline. The pushing back of a Grand Re-Opening of a newly remodeled location, or failing to complete all (300) locations of a roll out awarded in the allotted timeframe so that national advertising can hit the airwaves, are just two possible failure scenarios. So remember, when you are selecting a vendor/partner to choose wisely, because the selected vendor is ultimately an extension of your organization and could have a positive or unfortunately in some cases a negative impact. That said, knowing exactly what your needs are early in the game, should make the vendor selection process much easier to complete.
One question to ask yourself; does the vendor have a local, regional or national footprint? Vendor coverage area can be an important decision based on the scope of work and time allotted. National vendors may help simplify the process because of their coverage area and the diverse services offered. These services can be used for a broader scope of work and covering a larger geographical area. When utilizing a local or a regional company, odds are it will require more of an effort on your part. You will have additional follow-up on daily/weekly updates, billing, and project close-out documentation, just to name a few. The above-mentioned process can be streamlined with one simple phone call to the correct vendor.
“Chuck E. Cheese’s has, historically, used local/regional vendors for HVAC and national vendors for just about everything else. However, as our number of stores has increased, and our Facilities Department has grown, we are moving in the direction of more regionally based vendors for plumbing, electrical, general handymen, etc. for the larger markets. While this does create more work for the Facilities Managers, we believe it creates a closer relationship with the people actually performing the repair”, says Cathy Strain, a Regional Facilities Manager for Chuck E. Cheese’s, supporting 232 locations in the Western and Central United States. She began working at CEC in 1999 as their only Facilities Manager for approximately 200 locations and continued in that capacity until 2008, when she supported 450 locations, and it became necessary to hire a second Facilities Manager and split the stores between the two.
Another key question based on your needs; what are the services and capabilities of the vendors being considered? This can be an important question to ask if you are a multi-site facility manager. Reason being, you might only be looking for a vendor in the South for HVAC/R, a plumbing vendor that covers the entire US, or a total facilities maintenance and management company that has the ability to provide all services across the entire chain/US. As well as, does the vendor outsource their facilities? Local and regional vendors can tend to be self-performing with certain trades that can include, but not limited to, electrical, plumbing, HVAC/R and flooring. National vendors can complete most trades in many locations throughout the entire chain at one time. National vendors draw from a larger vendor base, have the ability to use a larger work force to complete daily tasks in more locations, and could potentially save time and money. In any of the aforementioned scenarios, a RFP could be developed and sent out, thus simplifying the process and narrowing your vendor selection even more.
When looking for a specific vendor it might be beneficial if a company can offer a single point-of-contact that is available 24/7/365. A good question to know is what are their procedures for emergencies? The last thing you want to do when faced with the questions, “Where is the contractor, when was he supposed to be here, or where are my parts?” is having to make multiple phone calls when in search of a single answer. Along with a single point of contact, it might be important if your account representative or designated backup are available 24/7/365 for emergencies and on-going updates. If something affects sales, service, or safety you will want to know what is happening at a moments notice whether it is during non-business hours or an emergency happens to fall on a holiday. Receiving the proper updates throughout the entire process can be vital for you and your location.
An additional question to keep in mind is does this vendor have reporting capabilities that can be shared? Please keep in mind when using many vendors all activities multiply by the number of different vendors you are using. In some cases, the facility manager is required to document the dollars spent as well as other pertinent work order or scope historical data. Examples of reporting that may be requested are: the average open work order, service costs by store, by region, by work order type, open work orders, closed work orders and quotes pending, just to name a few. Some work order systems can track the average timeframe a work order is open, i.e. — from the time the work order is entered, to the time it is scheduled, to the time the job is completed. After the job is completed, invoicing should follow soon after. Now you would need to ask yourself what are the billing capabilities each company has to offer? Invoicing requirements may include hardcopy, consolidated invoicing, softcopy or submitting electronically through a specific web site. Additionally, are your payment terms acceptable to all vendors (net 30, 45 or 60 days)?
Does your company have an internal or external call center? Some facility managers require vendors to work in conjunction with their call center continuously updating their work orders through the web. If this were the case then a requirement would be that the vendor would have to have web capabilities. For additional fees, some vendor’s systems can communicate automatically with the call center’s system. In other words, the two systems are linked thus minimizing the chance for error. This is not a requirement but it does save time and money in the end.
The previous paragraphs have discussed ideal requirements of potential vendors. In most scenarios, not one vendor is currently set up to simply step right in with little revision or adjustment on their part. That said something else to consider is the company’s financial stability. Do they have the financial means to change the way they currently conduct business? As mentioned, these revisions could include re-vamping their computer software, changing their invoicing requirements, extending payment terms, etc. Are the vendors willing to grow with the Customer’s current and/or future business growth? Can the potential vendors provide credible references that are relevant to your specific needs? Something else to take into consideration would be the overall company history within the facilities maintenance and management industry.
In conclusion, the intent of this article is to hopefully be a resource and a helpful guide throughout the vendor selection process. It will be important to do your due diligence and analyze all data collected before you make an educated decision base on the facts received. The time spent doing research will pay for itself many times over if you find the right partner. So remember, take into consideration and complete all the above crucial steps and the actual awarding and implementation process have the potential to be streamlined. In addition, you will most likely develop a long-term relationship with an outstanding vendor partner.
BIO
Tim Dehncke has held the position of Director and Sales and Marketing for Quality Solutions, Inc. (QSI) for nearly seven years. QSI is a national facilities management organization specializing in total facilities maintenance and national projects/roll outs. The company’s corporate office is located in Wichita, KS and has been in business for over twelve years.
"This article originally appeared in the 2009 Retail Facility Business Buyer’s Guide.
© 2009 France Publications, Inc., retailfacilitybusiness.com"
National Projects -
And what it takes to make them work.
Jared Gorges, National Project Manager
As a multi-unit customer, the challenge of a national remodel or retrofit roll-out can seem overwhelming. During the early stages of development there are numerous aspects needing to be considered and questions that arise.
When a roll-out type project is in its early stages one of the first items discussed is the scope of work. What is trying to be accomplished? Is it going to involve remodeling a certain area of the store or a minor retrofit in another? What trade(s) are going to be involved in completing the project?
The second item is budget. How much is this going to cost to implement? Is there going to be training needed or a pilot store completed? The cost of materials, the vendor’s install cost, shipping and warehousing cost, if required, additional personnel cost should all come into consideration.
The third item is deadline. What is the timeframe in which the project needs to be completed?
The next item would be qualifying vendors. Is a national vendor or regional vendor(s) going to be utilized throughout the project? Has the customer worked with any of the vendors being considered for the roll-out? If not, will those vendor(s) provide a list of references to contact?
The fifth item is developing and issuing a Request for Proposal (RFP). This process needs to stay project specific.
The sixth item is reviewing all submitted RFP’s and awarding/partnering with a qualified vendor.
The final item is notifying all of the stores included in the project. The notification step is a very important step when developing a roll-out. The stores are going to be the ones most affected by the project so they should always be considered throughout the process.
So the next time you are asked to be the lead or involved in any aspect of a national project remember the items referenced above: Scope of work, budget, deadlines, qualifying vendors, Request for Proposal (RFP), reviewing and awarding, and store notification. If you and your team can successfully accomplish the process from start to finish not only will you succeed but your stores and your vendors will succeed as well.
