Snails, Samples and Mr. Biggs: Negotiating and Maintaining Professional Contracts

As the chief executive officer of a Nigerian food processing and marketing company, Olusola Adegbesan knows that competing on price alone isn’t enough to attract and retain commercial customers. Instead, Adegbesan works hard to expand her client base with extensive networking and keeps it personal with existing clients through visits and phone calls.

Adegbesan’s Lagos-based company, Aces Commodity Products Limited (ACPL), processes, packages and markets Ofada rice, Cassava flour, Yam flour and other dry agriculture and food products. She is one of several women scholars to earn a certificate from Pan African University’s Enterprise Development Services (EDS) through the Goldman Sachs 10,000 Women program.

Adegbesan leveraged a networking contact to seal one of her larger deals — a contract to supply Mr. Biggs, a chain of about 170 quick-service restaurants owned by United African Company of Nigeria PLC. Scoring that big contract required some out-of-the box thinking, and maintaining the relationship takes work. “During a network meeting at Pan African University’s Enterprise Development Services, a fellow 10,000 Women participant who supplies snails to a Mr. Biggs franchise gave me a contact telephone number and location,” Adegbesan says.

Satisfying a Number of Tastes

Reasoning that taste and sight would be far more appealing than a verbal sales pitch, Adegbesan followed up on the lead by giving the Mr. Biggs franchisee samples of one of Aces’ products and then scheduling a formal sales call. “I returned a week later to find out if they were pleased with the trial offer,” Adegbesan says. “They were pleased and it led to an ongoing business relationship supplying their outlets with my products.”

Networking also led to a deal with Relish Fast Foods, another quick service chain. “A fellow Goldman Sachs 10,000 Women participant operates about four Relish stores,” Adegbesan notes. “She is a lawyer by profession but runs Relish for her parents. We met at the program, and I have been supplying her since then.”

She gets some new customers through word-of-mouth recommendations from existing clients, but Adegbesan and her network of trusted distributors also cold-call prospective customers, dropping off product samples so the prospects can taste the goods themselves. “They usually call back to put in orders,” she adds. “We ensure that the quality of the product will consistently satisfy them, and we offer a variety that will satisfy a number of tastes.”

In an attempt to diversify its client base, Aces devotes considerable resources to marketing as well as product research and development as a way to help attract and retain customers. Adegbesan adds that a significant share of Aces’ new business is driven by personal contacts. “We get some new customers through recommendations [from existing clients], but we also walk into the establishments of prospective customers and drop off samples,” she says. “I also keep in touch with phone calls and personal visits.”

Even if a company isn’t placing an order right away, Adegbesan will call or stop in for a visit “now and again to ask after their welfare and business,” she says. It is a strategy that many business owners may occasionally use, but Adegbesan does it on a consistent basis, staying in touch with selected key officers like managing directors, logistics and other managers who make supplier decisions.

Be Cautious with Concessions

When it comes time to negotiate a deal, Adegbesan adopts a flexible, patient and conciliatory approach. But she is also keenly aware of her own company’s bottom-line needs. “To close a contract we may be willing to make certain concessions,” she says. “For example, some customers do not always want to pay for delivery, and right now we do offer that, although we may stop that promotion once we’re more firmly established. However, where a customer pushes too hard [for discounts or other concessions] and I don’t seem to be able to win him or her over, it is better to let it go than to end up getting the contract and running it at a loss.”

A Pan African University professor cautions against making too many concessions. “Small business owners need to be very careful when they negotiate a contract with a large client,” says Peter Bamkole, director of the university’s EDS program. “The bigger firm may try to squeeze concessions from its supplier, perhaps delaying payment for more than 90 days and effectively forcing the small business supplier to fund the bigger customer.”

Meanwhile, Adegbesan’s company has supplied Mr. Biggs for more than a year now “and the relationship gets better every day,” she says. “Today Mr. Biggs Restaurants and the Village Kitchens [a specialty cuisine unit of parent company UAC of Nigeria] are my biggest customers. I look forward to continuing to work with clients and to build my business. My dream is to become a rice merchant trading in purely Nigerian local rice and to set up a processing factory and local commodity stores in Nigeria and the entire region of Africa.”

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