The hospitality industry includes a diverse group of businesses from rentals to planners, and designers, DJs, caterers, and so many more. Although we are all competing for business, we also need each other to survive. It is almost impossible for one company to be all things to all customers. Thus, we must develop strategic partnerships within our local collective.
As a rental company owner, I realized early on that purchasing and maintaining an inventory was quite an expensive venture. So, I began to think about how I could reduce my expenses while maintaining my reputation as a go-to source for my clients. I decided to seek out small companies that provided the same rentals or similar items to mine, and I made friends that would ultimately help me serve my clients with less overhead better. For example, linen companies usually purchase fabric from the same sources since they are limited, and the materials can be interchanged in a pinch. So, if both carry similar styles and the price to rent is less than cost, why not sub-rent from a fellow vendor. This ultimately allowed me to deflect the upfront cost and still satisfy the needs of my clients.
Now let's apply this same strategy to other areas. Take photographers for instance, most experienced professional photographers work weddings with a second shooter, and most of these professionals have their own small business as well. Strategic partnerships allow photographers to keep a list of professionals to call on when they need a replacement for an emergency or a second shooter in a pinch.
Many things can occur that would cause a vendor to need a strategic partner to call on. As a florist, you might need additional cooler space. A caterer might require more prep space, or a DJ group might need someone last minute. Friendly competitors are a great security net for an industry that regularly deals with last-minute bookings and changes, emergency changes of venue due to weather or closures, and damages to rental items before an event.
These partnerships are not limited to companies that provide the same services. They should also include "go to" vendors that can offer a complimentary service making our clients' planning process easier.
We want to provide the best possible product for our clients and sometimes we need to reduce or limit our offering to one category in order to maintain that quality. We still want to be all things and in order to provide all things we need strategic partners to help us fulfill those needs.
By divesting our inventory of underperforming items, our rental company was able to cut maintenance, space and employee costs. In order to maintain quality of service to our repeat clientele, we made a strategic partnership with a hard goods rental company that did not offer our product line. By making a reciprocal agreement for an exchange of goods at an agreed upon price we were both able to offer a full line of products without incurring additional cost.
Strategic partnerships are a vendor’s secret weapon. Creating friendly relationships within the hospitality industry is an insurance policy for the future, especially when we are recovering from such a critical period in our history. While we are still socially distancing it can be a little more difficult to make those connections even though now is when we need them the most.
If you need a place to start when looking for a new partnership you can take this downtime to do some research. Go back to past jobs, maybe they’re the jobs that got the most likes on social media or the larger jobs that went smooth. Think about the vendors you worked with. If you are a behind the scenes business, maybe you deliver and leave before anyone else arrives, look at the brides who wrote excellent reviews online and check out the vendor list. Take the time to look them up before you reach out. Look at their social profile and website, and consider whether their customer service promise and commitment to quality is the same as yours? Would you be willing to refer them? Only you can decide if it has the potential for a good fit, but these questions will help guide you.
We will all be looking for ways to streamline our business and cut costs where possible as we move forward. Consider how we can defer those larger purchases by sub-renting additional quantities of product or by working with another business to take advantage of purchasing power by combining orders. In the past we have combined our shipment of tables and chairs with a larger company and on delivery day our truck met the driver and took immediate delivery. The savings we received by volume discount was compounded by an additional shipping charge.
As we return to a more recognizable normal, it may be time to become a joiner. Don’t fear competition, embrace it. Meet the people in your area by joining local organizations like ILEA, NACE, and MPI, or take the time to meet like-minded people by hosting an industry mixer. Let them know what you have and that you are willing to work together because in the end… we all need friends!