How to become a preferred supplier for an airline

Apr 3rd, 2012

The global aviation industry will go sky-high in the near future with $3.5 trillion worth of aircraftdeliveries, according to Airbus.  The rocketing demand for new aircraft will naturally expand the MRO market both in value and the number of market players, opening outstanding opportunities for spare parts suppliers. But it will be hard for a supplier gain ground without obtaining the desired status of a preferred vendor.

According to Locatory.com, the majority of the MRO industry players based in the emerging markets are still hesitating to fully exploit the open market opportunities. Whilst searching for the spares in 90% of all cases companies use the preferred vendors’ lists.

‘There are many ways of becoming a preferred vendor. However, the main criterion is the price/quality ratio. It will largely determine whether a particular supplier receives the status or not,’ says the CEO of Locatory.com Zilvinas Sadauskas.

The first step is to set the right price for your spare part or component. Obviously, the lower the price is - the bigger the chances to seal the deal. However, the price cannot slip below the average market rates, since it may undermine the image of your product’s quality. But if you already have reasonable prices but the clients are still hesitant, you should definitely consider introducing special offers or discounts. First of all, this will allow you to offer even more attractive solutions without making your product look ‘cheap’. Secondly, companies commonly perceive exceptional concessions as an essential part of the ‘preferred vendor’ package.

There are many ways of becoming a preferred vendor. However, the main criterion is the price/quality ratio

The second step is to ensure the quality of your products. If you wish to persuade your client to establish longstanding cooperation, present him with as many licenses and recommendations as you can obtain. Every preferred vendor must have certificates and approvals for its products. Clients from other regions may decline the offer simply because they don’t know the supplier, but obtaining international certificates (EASA, FAA, etc.) will help you minimize the number of such cases. Furthermore, this is the only way both to ensure and insure the quality and reliability of your spare parts.

‘Of course, there are many other factors which may influence the final decision. The company values, for instance. Since many Western corporations are promoting the idea of sustainable development, it is possible that a clear pro-ecology supplier’s position may play the final card in the process of becoming a preferred vendor. In their pursuit, suppliers cannot afford to ignore even the smallest factor,’ commented Z. Sadauskas.

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