Logistics Service Providers are quick to point out their technological enhancements and service improvements in order to differentiate themselves from their competitors. In the sales arena account executives work diligently to develop client relationships.
Many LSPs, especially motor carriers, make extensive use of “customer entertainment” to gain and retain market share. Lunches, dinners, and sporting events are part of the job for carrier representatives. Developing client relationships makes the time and expense worthwhile for the rep even when business is not actually discussed. Access to decision makers, information to be used in negotiations, opportunity to present logistics solutions, and benefit of the doubt when problems arise are the result of good relationships for the LSP.
For the client the benefits can include good faith negotiations, competitive pricing, industry intelligence, and faster problem solving . It is best, however, to manage the relationship. Keep it professional and not personal.
Business lunches can be productive for both parties. Clients should have an agenda with a few discussion points. Remember, as with any meeting, if you don’t have an agenda you are subject to someone else’s. Mention your agenda when scheduling lunch and you will have your rep’s attention. Consider having lunch brought in so you are on your turf.
Expensive dinners and sporting events are much less productive from a business perspective. Food and drink becomes the main event. Business discussions are limited, especially if spouses are in attendance. The game takes precedence at sporting events. Big ticket entertainment turns the relationship from professional to personal. It is best to limit your exposure and partake sparingly, if at all.
In summary manage your carrier relationships, Don’t let your providers “reward” you for your business. It makes it much more difficult to change providers or negotiate new deals.