Communicate with your suppliers, and be friendly, approachable and honest. Show concern for their needs by understanding their business. If the supplier is having a hard time selling or getting hold of a particular product, consider being flexible in your offering. Your size and ability to “go with the flow” can be a benefit. Over time, you may be surprised at how much more willing they will be to make concessions when they know and like you – no matter how small an operation you run.

Follow seasons and sales cycles

Take advantage of seasonal prices. Produce is a cost that goes down dramatically when in season. Change your menu items and pricing accordingly. If there’s something perishable a supplier needs to offload the price will be good. If your kitchen is nimble and can incorporate it into the menu, perhaps as a limited-time feature, this can make improve profitability – particularly if this becomes frequent practice.

And don’t forget about sales cycles. If a salesperson needs to meet a monthly quota, talk with them just before month’s end. It’s a win-win if you can help them fill their quota and negotiate a sizable savings.

Take advantage of your “uniqueness”

If you specialize in a specialty food or cooking style, you may be a supplier’s main (or only) buyer for those items. This means you have a lot more leverage when it comes to negotiating on price. Shopping local can also save you some serious cash. Nearby produce vendors and food manufacturers may have higher costs than overseas suppliers, but when you factor in not having to ship product across a country or an ocean, you may realize some significant savings, and you’re likely to get a higher quality product for which you can charge a premium. Plus, you’re doing more than saving money, you’re running your business sustainably by cutting down on greenhouse gases from trucks, ships and planes – and that can be a big selling feature with customers!

Offer to pay more up front

Ultimately, suppliers want to know they’re going to get paid. If you’re able to make a larger initial deposit, you may be able to bring down the overall price. Talk with them about the future and how much you plan to spend with them long-term. That can make a difference too.

If you don’t have a lot of capital lying around, there are cost-effective solutions for that, too. Cash advance companies such as iCapital offers a lending model that’s specifically designed for restaurants and small businesses. “A merchant cash advance model where you repay through a small percentage of daily sales or a small business loan is a low-risk approach that empowers owners to invest in their businesses and realize profitability and success,” explains Diane Capobianco, small business finance expert at iCapital.

Running a small operation doesn’t have to equate to paying your suppliers more than the big guys do. Smart negotiating and investing time up front to find the best options can help you keep costs down and increase margins. These tactics have tremendous benefits for your business – and for your customers, too.

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About the author:

Liz Teodorini is Marketing Director at iCapital, a hassle-free and flexible financing solution for Canadian small businesses. The company, which is committed to being Canada’s most caring and responsive loan-alternative provider, frequently publishes articles relating to small business finance.