OPINION | Tony Robson
TONY ROBSON OPINION
Could supplier Service Level Agreements redress the balance between independent retailers and suppliers? The co-owner of Day True considers the possibilities
Redressing the balance A
least 25% of your showroom’. I’m sure most independents experience something similar and many other demands besides. As a retailer, and as a customer of these suppliers, we then have the pleasure of paying our suppliers to showcase their products in our showrooms – which are becoming increasingly expensive to run – taking up valuable square footage in-store. While we are their route to market to our valuable client base.
It would also be fair to say that the service issues are not with just appliance manufacturers and more significant corporate businesses.
Many projects require independents to depend on A Service Level
Agreement would outline what the
purchaser expects and equally what the seller expects, and yes, some do have
compensation agreements for
costs incurred if the agreement fails
1. Agreement overview: The
agreement overview outlines the fundamentals of the agreement, such as the parties in the agreement, the start date, and a general introduction to the services provided. 2. Description of services: An SLA must comprehensively describe all the services offered, under which circumstances they perform, and the turnaround times. 3. Exclusions: A list of excluded services
should also explain limitations and avoid confusion 20
smaller specialist companies to help deliver a project. These might include bespoke furniture makers, worktop fabricators, bespoke showering companies – all examples where I suggest a ‘way we work’ agreement would be beneficial to both buyer and seller.
I recently visited a friend who works in the aerospace
industry. I mentioned the service issues we are having as a business, and as an industry, and asked how his company navigates these issues effectively. He told me they would, as standard practice, have
Service Level Agreements (SLAs) in place between the trading companies – these are standard in other industries and larger corporate businesses and are used to agree on how both businesses trade. An SLA would outline what the purchaser expects and equally what the seller expects and, yes, some do have compensation agreements for costs incurred if the agreement fails. Good Service Level Agreements should have an agreed set of ‘key performance indicators’ (KPIs) that are regularly
The fundamental principles of SLAs
and assumptions from the other party involved. 4. Service performance: The customers and the
service
provider must agree on a specific performance measurement metric to evaluate performance levels. 5. Redressing: Compensation should also be defined, including the pay rate for service providers who cannot fulfil their obligations. 6. Stakeholders: An SLA must clearly define the parties involved and their respective responsibilities in the agreement.
7. Security: An SLA must also contain all the security measures the service provider will undertake, including
consensus on anti-
poaching, IT security, and non-disclosure agreements. 8. Risk management and disaster recovery: These plans and processes must also get laid out in the event of unforeseen circumstances. 9. Service tracking and reporting: The service tracking and reporting section encom- passes the reporting structure,
tracking intervals and the stakeholders taking part in the agreement. 10. Periodic review and change processes: You must routinely review the SLA and accepted KPIs to prevent or rectify mistakes and make changes. 11. Termination: To avoid sched- ule conflicts, the SLA should also define the circumstances by which the agreement can be prematurely terminated or expire. It is also essential to establish a notice period for each party.
· November 2022 monitored and actions improvements to be made.
They should also be implemented with the mind-set that if they do not adhere to that, both the buyer and seller, should be willing to walk away from each other if differences cannot be agreed and improved. As a small business owner, I fully appreciate that the time and effort to put these agreements in place is another energy-sapping process. However, I firmly believe that the current balance of
service agreements is firmly weighted in favour of the supplier and that an industry-recognised and agreed ‘service template’ would only improve us all to deliver world- class service levels for all of our customers.
put in place for continued
s an independent retailer, we are continuously asked to sign agreements issued by our suppliers, particularly the larger more corporate businesses, where we must adhere to their rules, such as: ‘minimum number of displays’, ‘minimum turnover’, ‘cannot sell items individually’, ‘must be at
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