The Benefits of Good Vendor Relations

Farley Nachemin, chief merchandising officer of The Company Store Group, Hanover Direct, sheds some light on why it’s worthwhile to cultivate good vendor relationships. Nachemin most recently was president of Hanover’s Domestications catalog. He recently spoke with Alicia Orr Suman, contributing editor.

Catalog Success: Why are vendor relations so important?

Nachemin: Along with paper and postage, merchandise is a major expense for a cataloger. You can achieve price opportunities, flexibility and other benefits from good vendor relations. For private-label merchandise, vendor relationships are vital for ensuring that you get the quality and good service you expect.

CS: Why is flexibility crucial?

Nachemin: It helps in keeping your fulfillment percentages up and out-of-stocks down by getting bestsellers in [stock] faster. And with international vendors, which many of us rely on, very flexible relations are certainly even more important. When you’re dealing with sourcing from Pakistan, India, China and other countries as we are, cooperation and assistance from your vendors are especially urgent in today’s volatile international climate. Our international vendors have gone out of their way to come to us recently, traveling every six weeks from Pakistan to New Jersey, for example.

CS: How do you achieve good relationships with your vendors?

Nachemin: We try to be honest about merchandising issues. We try to give [vendors] as much information as possible about our marketing plans. Treating them with integrity is another part of this honesty. Other retailers engage in secondary and tertiary chargebacks. They’re always scrutinizing merchandise deliveries for shipping compliances, carton guidelines, product-quality issues, etc. They’ll try to catch their vendors when they make errors and get as much money off of the delivery as they can.

Secondly, we believe that core vendors are part of our team. We try to give most purchases to those core vendors. If you “pollinate” your purchasing, giving, say, 3 percent each to a host of vendors, you won’t be a meaningful player to them — nor will they be meaningful to you.