Customer of Choice: Winning Supplier Capacity We Did Not Buy
CPO Path #22 CW 34 2026
EXECUTIVE PREMISE
Preferred-customer status may be more consequential than the label suggests. It describes a supplier’s willingness to allocate scarce people, ideas, capacity, and attention to one customer over another. A useful perspective is therefore to ask not only what a supplier is worth to the company, but what the company is worth to that supplier.
WHY THIS MATTERS
The 2026 Plante Moran Working Relations Index collected 750 Tier-1 supplier responses. For the first time in its 26-year history, all six OEMs improved; the analysis highlighted communication, commercial fairness, consistency, and clear expectations ([Plante Moran], 2026).
Volume alone, however, does not appear to explain preferential treatment. In a study of 91 automotive suppliers, customer attractiveness predicted preferential resource allocation until supplier satisfaction entered the model; the direct attractiveness effect then became insignificant ([Pulles et al.], 2016). A practical reading is that attractiveness creates interest; the lived relationship influences allocation.
THE REAL DYNAMIC
Preferred status is awarded by the supplier, not declared by procurement. Pulles and colleagues measured preferential allocation through behaviours including assigning better employees, sharing stronger ideas, and directing scarce resources to one customer during bottlenecks ([Pulles et al.], 2016). A separate study of 163 buying firms found the competitive effect of preferential resource allocation stronger in manufacturing than in services ([Pulles, Veldman & Schiele], 2016).
The more useful question is what suppliers respond to. Hüttinger, Schiele and Schröer found four factors with empirical support across their automotive study: growth opportunity, operative excellence, reliability, and relational behaviour. Innovation potential, supplier support, supplier involvement, and contact accessibility showed no significant overall effect on preferential treatment in that sample ([Hüttinger et al.], 2014).
Operative excellence included reliable forecasts, simple processes, and quick decisions. Reliability included truthful negotiation and keeping formal and informal commitments. Relational behaviour included shared problem ownership, fair value sharing, and flexibility ([Hüttinger et al.], 2014). Henke and Zhang similarly identify conflicting functional objectives, late engineering changes, and one-sided price pressure as conditions that can inhibit supplier-driven innovation ([MIT Sloan Management Review], 2010).
Two qualifications matter. First, innovation access need not imply paying more: across 166 buyer-supplier relationships, the expected link between supplier innovativeness and higher pricing for newly developed products was not statistically significant ([Schiele et al.], 2011). Second, relationship history is not insurance. In US truckload data, tight markets weakened the protective effect of long relationships as outside market options became more attractive ([Acocella et al.], 2024).
There is an interesting human parallel to this distinction. In the first episode of The CPO Interviews, Panos Anastasiou, CPO of Opella, describes career decisions in which the apparent attractiveness of an assignment mattered less than the quality of the people around it. This episode turns that logic outward: a supplier may find a customer commercially attractive and still decide that the working relationship does not merit its best people, scarce capacity, or earliest ideas.
The full conversation
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WHAT STRONG LEADERS DO DIFFERENTLY
One workable instrument is a preferred-customer assessment, completed from the supplier’s side of the table for the five suppliers whose capacity or engineering attention matters most:
Growth opportunity: Can this customer help us grow?
Operative excellence: Is this customer easy to plan and execute for?
Reliability: Do its commitments survive internal pressure?
Relational behaviour: Are problems and gains genuinely shared?
A weak score becomes useful when attached to an internal cause: forecast volatility, late specification changes, contradictory functional demands, slow decisions, disputed commitments, or payment friction.
The follow-on can be a one-page “What We Are Worth to You” brief: future opportunity, operating predictability, commitments kept, decision access, and one improvement the supplier wants. Its purpose is not self-promotion. It is to test whether procurement’s view of the relationship resembles the supplier’s.
CPO PATH DIAGNOSTIC
Statement | Fully true | Partly true | Not true |
|---|---|---|---|
Our critical suppliers see a credible growth case with us. | ☐ | ☐ | ☐ |
Our forecasts and changes allow suppliers to plan reliably. | ☐ | ☐ | ☐ |
Internal functions present coherent priorities. | ☐ | ☐ | ☐ |
We keep commitments when conditions change. | ☐ | ☐ | ☐ |
We know what each critical supplier wants us to improve. | ☐ | ☐ | ☐ |
ONE-LINE VERDICT
Spend may secure the contract; the supplier’s experience of the relationship may decide who receives the scarce resource first.
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Talk soon,
Pascal
Did this resonate with you?
Quick wins to implement today: helpful structures I use and you should check:
Who should sit in the next chair?
Episode 1 of The CPO Interviews was Panagiotis “Panos” Anastasiou, CPO of Opella. Episode 2 is open.
Which CPO would you want to hear for two hours, uncut? Your own? Someone whose thinking you have followed from a distance? Name them — and if you can make the introduction, better still.
Replies to this email, or write to [email protected].
Currently available: interim procurement
I step in when a procurement function has a gap that cannot wait for a permanent hire: a vacant lead role, a tender that has to reach award, a supplier situation that needs someone full-time, or a new site or project with no sourcing structure yet.
8+ years across direct, indirect and CapEx — USA, Asia, EMEA.
Capacity from September 2026 — or immediately, if the situation cannot wait. Part-time or full-time.
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SOURCES
Plante Moran. “2026 Working Relations Index.” 2026.
https://www.plantemoran.com/get-to-know/news/2026/05/2026-working-relations-index
Pulles, N. J., et al. “The Impact of Customer Attractiveness and Supplier Satisfaction on Becoming a Preferred Customer.” 2016.
https://ris.utwente.nl/ws/files/265887505/Pulles2016impact.pdf
Hüttinger, L., Schiele, H., & Schröer, D. “Exploring the Antecedents of Preferential Customer Treatment by Suppliers.” 2014.
https://doi.org/10.1108/SCM-06-2014-0194
Pulles, N. J., Veldman, J., & Schiele, H. “Winning the Competition for Supplier Resources.” 2016.
https://doi.org/10.1108/IJOPM-03-2014-0125
Schiele, H., Veldman, J., & Hüttinger, L. “Supplier Innovativeness and Supplier Pricing.” 2011.
https://doi.org/10.1142/S1363919611003064
Henke, J. W., Jr., & Zhang, C. “Increasing Supplier-Driven Innovation.” 2010.
https://store.hbr.org/product/increasing-supplier-driven-innovation/SMR337
Acocella, A., Caplice, C., & Sheffi, Y. “Great Expectations.” 2024.
https://journals.sagepub.com/doi/10.1177/10591478241277463
Thank you for your time and trust,
Pascal Hecker | Editor-In-Chief, CPO Path.