Suppliers may be willing to offer you favorable pricing in exchange for your business, but that assumes you have enough control over your spend to direct your purchasing dollars to them.  In businesses with multiple locations where purchasing decisions are made at the local level (like the hotel business), suppliers have good reason to be skeptical of your ability to deliver corporate-wide volume.  The supplier, armed with a large sales force, may feel he has more control over the purchasing decisions of your buyers then you do. 

There are a number of industries where most purchasing decisions are made at the local level.  The hospitality industry, where Birch Street focuses, is one.  If you’re in a sector like this, your organization may have significant corporate-wide purchasing volume, but it can be difficult to translate this into a strong negotiating position due to the distributed nature of the business and the inherent difficulty in measuring and controlling your spend.

Effective supplier negotiations also require that you know what your organization is buying; from whom you are buying; in what volumes; and at what price.  Again, the distributed nature of these sectors can make collecting this kind of data very difficult.  In most cases, accounts payable data lacks the detail to break it down into categories and products.  This detail is what’s required for truly effective vendor negotiations.   You can bet the vendor knows exactly what each of your locations has bought from him, in what product mix and at what price.  Without detailed data and analytics you’re going in with far less information then the vendor.

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