Choosing Fellow Travelers

While Dino originally wrote this in 1999, it is just as applicable today!

Forty years of entrepreneurial experience taught me that a key part of success is choosing the right “fellow travelers” (customers and suppliers) who share the “direction” of my business. When I have chosen wisely, our shared direction made the relationship a win-win for all parties.

A good metaphor for business relationships with each customer or supplier is rowing a boat together, with each of you pulling separate oars. If you both pull towards a common direction, the shared boat travels further, faster. However, if you and your customer or supplier pull in different directions, the shared boat tends to travel in circles.

That is why the more you share a common direction with the customers and suppliers you choose, the better your odds of success. Since the constant in any business is the quality vs. cost tradeoff, the first decision is to choose your direction relative to that tradeoff. Then seek customers and suppliers traveling in that same direction. Let me explain.

If your business direction is serving superior quality food, seek customers who recognize and are willing to pay for superior food, and then seek dependable suppliers of the superior ingredients you choose. Alternatively, if your business is focused on lowest selling price, seek customers motivated by lowest selling price rather than highest quality and seek suppliers of the lowest cost ingredients, irrespective of quality. (Choosing average quality and average price is the worst, because neither customer type has a compelling reason to favor you over competitors.)

Here’s a way to measure your direction and your “fellow travelers.”

1) Is your business direction (selling price vs. superior food) clearly set? If not, you are probably burning energy rowing in two different directions, while confusing customers and suppliers.

2) If your business direction is low selling price, do you recognize that success requires customers who rank cheapest price above food quality? Are your marketing efforts aimed at attracting this customer type? (In this case, location matters because this customer type does not have to travel far to find low price competitors.) Do you also recognize that requires buying the lowest cost ingredients, regardless of quality? Have you communicated this to your distributor(s)? Do you regularly “shop around” for the cheapest price, regardless of brand? (Note: The cheapest alternatives are often “Big-D” labels which are “shopped” from multiple producers on the basis of price.)

3) If your business direction is serving superior food, do you recognize that success requires customers who value food quality above comparative price? Are your marketing efforts aimed at attracting this customer type? (In this case, the key is attracting knowledgeable customers who recognize superior food and will return to your location wherever it is.) Have you also comparatively tasted and evaluated various brands of each ingredient and chosen the best one? Have you told your distributor(s) that you will accept no substitutions? If your distributor switches any of your chosen brands, do you promptly throw him or her overboard?! If your distributor consistently delivers your chosen brands, do you reciprocate with your loyalty?

Summary: The distance and speed of your business “boat” depends on choosing the right “fellow traveler” customers, and then suppliers. Expecting to attract quality oriented customers with mediocre food sold at low prices or price oriented customers with superior food sold at profitable prices leads to rowing in circles. (In both cases, you fail to satisfy them.)

Instead, choose food superiority or lowest selling price as your direction and avoid the average food/average price trap! Then focus on attracting “fellow traveler” customers and suppliers and row together to get where you are headed!