Suppliers... Suppliers... Suppliers... |
| Suppliers are a necessity in the private club industry for everything ranging from food and beverage suppliers to tax advisors. But it's not all peachy-keen. It's like a love-hate relationship. One can't work without the other. Sometimes it works better than at other times, but it's not that problems can't be solved because they can. |
| Sound like a love story...like do you love your suppliers or are they a source of frustration? No doubt, the supplier-private club relationship is one of the most important in the daily operation of private clubs. And clubs need good vendors today more than anytime in the past. |
| Some are dealing with fewer members joining, a higher percentage of members leaving and lower member loyalty. It's causing a financial strain for some clubs and the solution for some is higher dues or assessments. For others it may be in purchasing...how your club deals with purchasing. Are you welcoming newer vendors who can provide you with savings and maybe a better product? |
| Solutions are out there for issues such as membership, member loyalty, staffing, taxes, operational issues, strategic planning, legal and environmental matters, and aging club house and/or course facilities. With solutions available, why is it so difficult for solutions providers to meet club decision-makers. And how can solution providers do a better job in communicating their message and providing better training for sales reps. |
| The private club industry is unique, and nothing upsets a manager more than a sales rep that isn't prepared, doesn't understand the uniqueness of a private club and how it works. Private clubs are not restaurants, hotels or public golf courses. |
| Consider the story of the cappuccino machines sales rep making his rounds. He was welcomed into a club for a presentation with the club house manager, the general manager and a board member. The rep delivered his prepared speech to each of them. |
| His mistake? Delivering the same speech to each of them. The sales rep neglected to do his research on the club and qualify what each person wanted to know. For example, the club house manager wanted to know whether or not his staff can use the equipment easily and provide excellent service to members. For the general manager, it's price and for the board member, it's taste. How good is the cappuccino? |
| The sales rep needed to highlight different aspects of his product, service and solutions in his dealings with each of them. It is also vitally important for suppliers to give managers all the information they can about functions, features, advantages and benefits of their products so managers are better prepared to present information, products or services to their board. |
| Sometimes you can't blame the GM for being the gatekeeper...maybe vendors need to do a better job. |
| So how does it all start? How do clubs locate the right suppliers? How do they know who's good? How does a club make a decision? Does longevity in supplier-club relations really matter? And where does all this process start? |
| It's in pleasing members and guests at clubs says Mike Hyler, general manager, Riviera Country Club, Los Angeles, CA. "We need vendors and suppliers in order to reach our goal of pleasing our members and guests, and a good relationship exists when the club and the vendor are doing business and both are happy with the results." |
| Club managers or representatives, at times are not anxious to meet with vendors when, for example, they are making cold calls without appointments, or selling inconsistent products or those of no value to the club. |
| "It is true I do not generally look forward to meeting with sales representatives," but the discussions oftimes lead to "positive results... new ideas, technology and product introductions," says Leon Crimmins, general manager of The Plantation at Ponte Vedra, Ponte Vedra Beach, Florida |
| "I am not frustrated with vendors. In fact vendors and suppliers have made positive contributions to our facility...with information, expertise, advice and problem solving." |
| But frustrations some people do face! To wit, Ron Banaszak, CCM, manager of the Glendora Country Club, Glendora, CA. |
| "Receiving the wrong product. Receiving the right product at the wrong time. Broken or slightly damaged products. Pushy salesmen. Rude deliverymen (truck drivers), blaming the computer for human error, sob stories to the purchasing agent to make a quota (give me a break), driving a fancy car and then complaining about not making enough money. |
| "The list goes on..." But it's not a one-sided affair. Suppliers have their beefs too. |
| "Private clubs by nature typically do not have the purchasing power or political power (connections) to obtain the best pricing and deals. Private club management and directors are so inundated with trying to operate the daily business of the club that they do not have the time or ability to sift through the prices of every item purchased every day, " says Jimm Moody Jr., director of food sales, International Club Suppliers. |
| "Private club management and directors also formulate relationships with some suppliers or may have their hands tied by the board of directors or a club member and refuse to investigate other options or avenues to save the club money," he declared. |
| "'Some of the most common excuses: "I (we) have always done it this way, or X number of years ago I purchased from that company and had a problem and I (we) will never purchase from them, or I (we) believe in supporting the local vendors and the community, or Someone I know told me this does not work.'" |
| "Many club directors and management have incorrect knowledge about products and services and refuse to admit their lack of knowledge, and egos can get in the way when one tries to correct them," Moody opined. |
| It's somewhat the same story told by PAPC Executive Director Tom Curtin. |
| "The single most unrelenting frustration is offering a program to the club that is GUARANTEED to save the club money, and they do not (join) or take advantage of the offering," he stated. |
| "The second, but almost as unrelenting as the first, is trying to locate a decision maker at the club. I find very few general managers or chief operating officers that can make the decision. |
| "To deal successfully with these frustrations is to understand the capacity of the individuals you are dealing with. In most cases the manager is not the ultimate decision-maker for all aspects of the operation. Once this is understood, the frustration is bearable," Curtin suggested. |
| For specific kinds of companies, the frustrations are different. As an example, MembersFirst, Inc. provides member relationship management tools, and part of the mission is to convince clubs there are better ways of communicating and marketing to club members than using flyers, calendars and monthly newsletters. |
| These methods, says Tony Baudanza, president and CEO, MembersFirst, Inc., are "time consuming, expensive and have absolutely no measurable return on investment. |
| "It is also very frustrating to be considered a 'website' company, when in fact MembersFirst provides member relationship management tools. The objective is to "help the general manager prospect and add more members, fill the dining room, sell out events, manage reservations for facilities and registration for events. |
| "Through more cost effective, target marketing we help increase participation with measurable results," Baudanza added. "Imagine within 30 seconds we can entice all members who have not met their dining minimum to join you for dinner. Tough to do with a flyer!" |
| Moody feels dealing with other organizations in the private club industry helps. "You try to develop relationships with management and directors. You support organizations such as CMAA, CAA and NGCOA and hope that you will be able to get an educational message through. |
| "You walk away from clubs where management and directors will not provide you with an opportunity to present yourself and your company, and wait for their replacements to be hired," he suggested. |
| And that leads to what vendors pinpoint as their biggest obstacle. Getting in front of decision-makers and why it's so difficult to do so. Moody has some ideas. |
| "The problem of ethics with some club's managerial staff still exists (What's in it for me?). The problem of some managerial staff feeling they have more knowledge that the professionals in the supplier network. Granted some in the supplier network are not as knowledgeable as some in the club industry, but by and large personnel in the supplier network is as knowledgeable about their products and services as club personnel is regarding their particular club." |
| Moody, at one time a club general manager, says "I can understand the reluctance to give an audience to a potential new supplier if the club is not searching for one." That, he says, means suppliers have to pursue the "chain of command and that usually does not include the board." |
| Additionally, Moody suggests general managers don't have decision-making authority over all areas of the club, "even though they wear the title general manager. There is also a reluctance to make decisions regarding food purchasing even though the chef answers to the manager." The net result is a presentation "to someone who is not the decision maker. When you do have the right person, often the problem of changing their mindset is a problem that cannot be overcome." |
| Others sing a similar tune. PAPC's Curtin says it's tough finding a decision maker who can truly make a decision regarding the program PAPC says will save the club money. |
| "What we offer is operational and we should only meet with the general manager. This is not something that should go to the board if the GM is truly a GM. In those rare cases where the GM sees the value of immediately accepting the value of the offering, they write a check. However, in most cases the GM defers a decision for some unknown reason and we must conduct a number of follow-ups." |
| Baudanza says his company's biggest obstacle is "relying on someone other than ourselves to present our product or service to the board of governors. It is very difficult for a general manager to be an expert on everything and a salesperson for our company and service. |
| "It is," he adds "very difficult to obtain an audience in front of a board for at least two reasons...they typically meet only once per month and the general manager seems to keep vendors at bay. |
| "When given the opportunity to present to the board we most often win and end up partnering with the club." |
| Given these frustrations and obstacles on both sides, how do clubs make vendor decisions. In some cases, it seems fairly easy. |
| "Best product at the best price," says Glendora's Banaszak. "Suppliers are given the club's current purchasing policy. This outlines the need for the club to be the beneficiary of every purchase and not the individual vendor or purchasing agent. |
| "Reputation plays a big part also. If a supplier is known for not behaving in the most professional manner possible, they will not do business with the club," he declared. And he has some more advice. "Check the references of all suppliers, know who the owners are, and what their reputations are." |
| The Internet is a growing tool for clubs. "It's becoming a huge player in the vendor selection arena," Banaszak declared. "A manager can go on-line and track down the exact item needed, even if the company that sells it is out of the area, state or country. |
| "One can check the past dealing of a supplier by doing a key word search. Recent periodicals on the company will show in a matter of minutes." So that opens the door to an even greater choice, but Banaszak says, "professionalism and quality are the deciding factors." |
| Major companies can maintain reputations and neighboring clubs can recommend "good" vendors, but for a decision "it depends on the type of supplier," the Riviera's Hyler added. "If it is food, you consider the company's reputation in the community, your own experience with the product and the reliability of their sales people. |
| "Some companies have superior products but it is agonizing to deal with them, " Hyler related. He also stressed suppliers are chosen differently, depending upon the goods or services required. |
| "For instance, the club chooses to use paper, cleaning material, meat, fish and dry goods suppliers based on a relationship that exists for some length of time," he outlined. |
| "These relationships are ongoing, given that trust is built and there are no incidents that trigger a separation and search for a new supplier." Hyler says his clubs does a review of long-term relationships every two years to compare the pricing structure and products of the competition. |
| "Sometimes the club's vendor is higher priced in some areas, but we know that most vendors will give you a 'sweetheart' deal to get in the door and the pricing slowly rises once they have the business," Hyler said. |
| Jim Powell is CEO of The Glencoe Club, a private club in Calgary, Alberta Canada. His long time experience suggests there has been little difficulty working with suppliers for day-to-day operations, but such packages as capital expenditures or renovations can be something quite different where delays are more frequent. |
| Dealing with member-owned or operated suppliers is also a ticklish matter. "The Glencoe does deal with members but "if the supplier doesn't produce the way they're supposed to produce, they're out," Powell stressed. The policy is in place in light of a legal opinion stating members are not in conflict with the club's articles, if the conflict is declared and the member or board member who is affected by the potential conflict, does not vote on the matter. |
| Hyler offers a somewhat different opinion...and a caution. "This is dangerous practice because if and when there are difficulties with the relationship, the club manager is in a difficult position. |
| "It begins harmlessly enough with the member having just what the club needs and for the best price. The member community gets wind of the purchase and both the club and the member are questioned as to the value of the relationship," Hyler stated. |
| Baudanza is to the point: "The general manger is put in a very awkward situation when a member or member's company is performing a service for the club. In our case very often a club will tell us that a member is currently 'doing the Web site' and all discussions end." |
| So what do suppliers and private clubs recommend to make these relationships function more smoothly? |
| "Contrary to the belief of club management and directors, suppliers communicate. They know what the other suppliers are charging the club and they do the same," says Moody. But there are actions he feels his fellow suppliers must take. |
| "Some suppliers need to stop aiding the club management and directors that are unethical, and be upfront regarding the cost of such 'so called' freebies as trips, sporting event tickets and merchandise. The club ALWAYS pays for the freebies. Some suppliers also need to be honest with clubs regarding products and services because most of them utilize the same manufacturers and suppliers." |
| Curtin, as a supplier, feels companies must provide clubs with "a quality product appropriate to the private club, honesty on their part, offering the very best price and above all else patience." |
| Publisher's final thoughts |
| As the comments suggest, the supplier-club relationship is an uneasy but necessary relationship. Many club executives agree suppliers do a pretty good job in the private club industry, a very competitive market. But there are considerations that help. The private club industry is different and need to be looked at as different. Many of the suppliers are the same throughout the country and clubs get used to familiar suppliers. |
| Vendors need to see the big picture in this industry. They need to work on long term relationships. They need to better understand private clubs, the levels of service, amenities, elements and nuances. They need to distinguish between the private club industry and other sectors and above all meet club managers and leaders in the private club industry. |
| Clubs, above all, need to put the interests of the club first. They need to develop trusting long term relationships with suppliers, deal honestly, give access to decision makers, and with due dispatch. |
| It's a relationship that requires give and take and in the end there are no secrets. Treat each other with great respect and deliver more than you promise. At least that's the way I see it. |
| John Fornaro Publisher |