Andrew Carnegie once stated, “Teamwork is the ability to work together toward a common vision. The ability to direct individual accomplishments toward organizational objectives. It is the fuel that allows common people to attain uncommon results.”
Vendors and property management teams, work every day to improve operational efficiency, environmental sustainability, tenant care, and more. Working together is integral to the success of our commercial properties and their organizational objectives and often lead to uncommon results, just as Carnegie defined. I sat down and discussed property management and vendor relationships with Shane Froman, and Shawn Benjamin. Here is what they had to say.
How can vendor partners and the management team build trust?
“It takes time. And it takes hard work. And it takes honesty. There are a lot of things that go into it. But it certainly doesn’t happen overnight.” explained Shawn Benjamin, Account Manager, Atlantic Paper.
“To add to that,” said Shane Froman, Senior Vice President, Lincoln Property Company, “I have a unique situation, where I left and went to the vendor side for four years. When you do that, you learn very quickly who you made relationships with are long standing because those people don’t disappear.”
“There are quite a few folks, who would reach out and give me a call to see how I was doing, even though I was on their side of the world. So, when I did go back, those were the first people I called when I needed something. It was because of their trust. They weren’t out just for their self; they were there as their authentic self.”
“I used to speak at my local Building Owner and Managers Association (BOMA) New Member Orientations, and I always promoted to vendors, you need to develop relationships with people and don’t come at it with a complete business mindset.” Froman continued. “By that, I mean, invite someone out for lunch, or swing by the office, and you’re not there to pitch business, or what you’re selling. Actually, take them to lunch and ask them how they are doing.”
“Ask them about real world things, share about your life and family, ask them about their life and their family. And try not to talk about business and see where that gets you in your relationship. If every time you call, folks feel like you are trying to sell your product, that is not a relationship, that is just a sales call. Treat property managers the way you want to be treated. I caution folks who sell by the number.”
“Close the deal and move on and never stay in contact? That is an unfortunate way of doing business.” Froman said.
One of the most challenging tasks for all property management teams is budget season, so I wanted to know how vendors can support our property management professionals through this process.
Froman was able to provide some great advice, “It used to be, budget season was in September and October, five or eight years ago, and budget season now is July through October. And in some cases, June! Realizing that coming to us with numbers in October and September is worthless. We have already done all of our work. So, for me, I am writing budget policies in May/June and soon every Property Manager will have their budgets and what they need to budget for, from a corporate stand- point and all the way down.”
Froman therefore suggests a few questions to engage with your Property Management team. Such as:
“I’d really like to be a partner with you and understand more about your budget process so I can be more beneficial to you as a service partner. How does that work? What is a good time to present you with things, for you to think about?”
Benjamin was able to provide a different, yet valuable perspective as well. “With product, it is important to keep Property Managers posted on market dynamics and how those dynamics may affect pricing moving into the next year. The pandemic has really changed our conversations toward occupancy levels, which affects stocking levels. It is very difficult for us, especially now, during budget season, to predict what is going to happen.”
Collaborations between service partners and property management are indeed beneficial to everyone involved, but these are also business transactions. So where does pricing come in, in this equation? Do all vendors have a possible incorrect assumption about their prices to customers?
“Absolutely. Service partners have the assumption they need to be the lowest bidder.” Said Froman. “And in some cases that is absolutely correct, because we have some clients, bottom line, written in our management agreement, that we must accept the lowest bidder.”
“However, there are also agreements, where it is a part of our job to go to our owners, and even if a service provider is higher or mid-bidder, to validate why, we believe, that is the right scenario for this situation. So don’t always assume lowest bid is where we are always going to go.”
“What are you bringing to the table? What is the variable? What we are looking for from this partnership, are the partners that are going to truly make a difference, even if [the cost] is a little higher.” Froman explained.
“Work with us to point those out and make sure we understand that, because we are not always the smartest person in the room. Make sure we understand while you may have a small increase in cost, you are supplying us with something that is so much greater in value that is not necessarily tangible to the dollar, so that we can provide that to our client and then it relates back to that tenant experience.” Stated Froman.
“And I will tell you, we are looking at a lot of that stuff, because our tenants are trying to get their employees back in to these buildings and create an environment they want to come back in to and not stay out. We are asking ourselves, what can we do for large impact and small cost impact that will create a better impact to the tenant’s employees experience, coming back to the building and help them get back in.”
Froman continues, “The cost of the product is one thing, but the service is another. Let’s say we have two companies, A, and B. We are going to take a look at their numbers, but we are also going to check service levels because we may see A has the lowest cost, but they fumble a lot of the deliveries. Although their pricing is great, I don’t know if we want to do business with them because they can’t seem to get us our product on time or there is always a fumble.”
“So, we may go with company B whose pricing is a little higher, but they always deliver on time.”
Benjamin is very familiar with this as well.
“I recently won a piece of business where my costs were higher, but the customer chose us, because they knew the people in my company.”
“They trusted us. They were tired of mistake after mistake from another supplier and they were willing to give up a percentage of cost savings, they were willing to pay a fair price for someone they trusted to always do the right thing.”
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