How a Strategic Community Can Enhance a Great Buying Group

In order to make progress, one must have a strategy in mind. People all throughout history have had to strategize for things ranging from taking over their neighboring kingdom or defending their own kingdom from invaders to winning a simple game. 

In the business world, people have to strategize in order to make their company successful. There are all sorts of strategies that businesses can use, but one type of strategy that is often overlooked is community involvement.

There are many different strategies that one might employ. For example, if you’re in construction you might find it useful to have access to a kitchen cabinet manufacturers list. This would give you an idea of which companies make cabinets and where they are located. 

You might also want to join a business group or chamber of commerce in your area so that you can network with other businesses. Another strategy might be to offer discounts or freebies to customers who refer others to your business.

A very powerful strategy is to join a buying group, but even buying groups require strategy. There are different types of buying groups, each with its own benefits and drawbacks. Today, we’re going to focus on these groups as well as how good strategies can make your involvement even more fruitful.

Understanding a Buying Group

Buying groups are a pretty universally used thing, but if you’ve never been in one you might not really understand why. Let’s, for just a moment, look at a good analogy. The United States is a collection of states, each with its own government. 

The states are, in a sense, autonomous entities. However, there are certain things that the states can do together that they couldn’t do on their own. For example, the United States as a whole can enter into treaties with other countries. Individually, the states could not do this (and if any state did try to negotiate its own treaty it would be invalid).

Similarly, buying groups allow businesses to band together in order to get better deals from suppliers or manufacturers. The group will often have more negotiating power than any one business would have on its own. There are several different types of buying groups: 

• Manufacturer-sponsored:
  • These are created and run by the manufacturer of a product or service. The goal is usually to increase market share or gain entry into new markets 
• Producer cooperative: 
  • This type of group is owned by its members who are usually producers of similar products 
• Trade association:
  • A trade association represents businesses in a particular industry and lobbies on behalf of those businesses 
• Franchisee association:
  • This kind of group represents franchisees within a particular franchise brand 
• Purchasing consortium: 
  • These consortia aggregates purchasing volume from member organizations to get discounts from suppliers 
• Group purchasing organization 
  • These organizations negotiate discounts with suppliers on behalf of their members

There are some drawbacks to buying groups as well. One of the biggest is that you might not be able to get everything you want from a supplier through the group. This is because the group will usually have an agreement with one or a few specific suppliers. 

Another potential downside is that there can be conflict within the group if members have different goals or priorities. Finally, some buying groups require membership fees which can add up over time.

Despite these potential drawbacks, buying groups are still generally considered beneficial for businesses of all sizes. If you’re thinking about joining a buying group, it’s important to do your research so that you choose one that’s right for your business needs.

Businesses from all over the world and of all sizes flock to buying groups in order to improve their bottom line. There are many different types of buying groups, each with its own set of benefits and drawbacks. The most important thing is to choose the right group for your business needs so that you can maximize the advantages while minimizing the disadvantages.

Strategies for Improving Your Involvement in a Buying Group

As we’ve mentioned, strategizing is incredibly important. That’s why we wanted to look at a few strategies for this particular area. Now, do keep in mind, we aren’t going to be reinventing the wheel here. But, we will be giving some tips that might help you get the most out of your involvement in a buying group.

There are many strategies that are commonly implemented, for example: 

• Doing your research first: 
  • This is always important, but especially so when you’re looking into buying groups. Not all groups are created equal and you want to make sure that the one you choose is the right fit for your business. Ask around and see if anyone you know has experience with a particular group. Once you’ve narrowed down your options, take some time to look at each group’s website and read through their materials. 
• Defining your goals: 
  • Buying groups can be beneficial for a variety of reasons, but it’s important to have a clear idea of what you hope to achieve by joining one. Do you want to lower your costs? Improve your terms with suppliers? Get access to new markets? Having defined goals will help ensure that you choose the right group and also help measure your success once you’re involved. 
• Finding the right supplier: 
  • One of the most important aspects of any buying group is its relationship with suppliers. You want to make sure that the group has agreements in place with reputable suppliers who can provide quality products or services at a good price point. Again, doing your research ahead of time can be helpful here so that you know what kind of agreement the group has in place with each supplier before making any commitments. 
• Reading any paperwork you’re given: 
  • This might seem like a no-brainer, but it’s important to read (and understand) any paperwork that you’re given before signing anything. This is true for any business dealings, but especially so when joining a buying group. Make sure you know what kind of agreement you’re entering into and what the group’s policies are regarding things like membership fees, minimum purchase requirements, and so on.

Of course, these are just strategies that your company can use. What kind of strategies can be employed by the entire community? Let’s take a look at a few: 

• Encouraging local businesses to join: 
  • As we mentioned before, one of the benefits of buying groups is that they can provide valuable networking opportunities. But, in order for those opportunities to be worthwhile, there needs to be a good mix of businesses represented. One way to improve the overall quality of a buying group is to encourage local businesses from a variety of industries to join. This will help ensure that everyone has something to offer and that the group as a whole is more beneficial for everyone involved. 
• Working with other groups: 
  • There are often synergies between different types of groups. For example, business improvement districts (BIDs) and chambers of commerce often work together on initiatives designed to benefit their memberships. Buying groups can also partner with each other or with other organizations in order to achieve collective goals such as negotiating better prices from suppliers or increasing market share for member products or services. 
• Lobbying for change: 
  • Another way that communities can support buying groups is by lobbying decision-makers on behalf of issues important to the group’s membership base. This could include things like advocating for lower taxes on business supplies or fighting against regulations that would make it harder for members to do business. By working together, community members can have a greater impact on decisions made at the local, state, or even federal level that could have a direct impact on the buying group’s ability to be successful.

If you and your buying group are working together well, you should start to see some positive results fairly quickly. However, it’s important to keep in mind that these things take time and there will likely be some bumps along the way. The most important thing is to stay focused on your goals and continue working together towards collective success.

A buying group can be a great asset for any community, but only if it’s used effectively. There are many different ways that communities can support buying groups, such as encouraging local businesses to join, working with other groups, or lobbying for change. 

By employing these strategies (and others), communities can help ensure that their buying group is successful and able to provide tangible benefits for all involved parties.

Being in the Right Place at the Right Time

Being in the right place at the right time can be tough. In many instances, it can feel a lot like it’s entirely up to luck. That being said, if you‘re strategic about your moves, you can put yourself in a much better position to succeed. When it comes to business, one of the best things you can do is join a buying group.