Help Prevent Corruption: Just Say NO to Vendor Kickbacks

Let’s start off describing what vendor kickbacks in the agency world are and then we can talk about why they are such a bad thing.

Vendor kickbacks refer to the practice of vendors paying money or offering other incentives, to agencies, in exchange for favorable recommendations or increased business. While this practice may seem like a win-win for both the vendor and the agency, it ultimately leads to harm for the 3rd participant in this relationship — THE CUSTOMER!

Why are vendor kickbacks so bad for the customer?

1️⃣ Vendor kickbacks can lead to higher prices for the customer. Companies may use kickbacks as a way to offset the cost of doing business, leading to inflated prices for products and services. This can make it difficult for customers to find the best value for their money, as they may not be aware that the prices they are paying are artificially high.

2️⃣ Vendor kickbacks can also compromise the quality of services. Agencies may prioritize the interests of the vendor paying the kickback over the quality of their services, leading to lower-quality services and poor customer experiences. This can have serious consequences for the customer who are often left in a worse condition after engaging with the agency.

3️⃣ Agencies in these scenarios routinely use aggressive sales and marketing tactics to sell the vendor’s products to existing customers and prospects, even if the customer does not need the product or the specific product is not a good fit for the customer.

4️⃣ Vendor kickbacks can foster an environment of corruption and unethical behavior. Companies may use kickbacks as a way to gain a competitive advantage over other businesses, leading to a lack of transparency and fairness in the marketplace. This can result in a decline in customer trust, as customers may feel that they are being taken advantage of by companies that are engaging in unethical business practices.

Vendor kickbacks are bad for customers because they lead to higher prices, reduction in quality of services, customers purchasing products they don’t need, and they foster an environment of corruption and unethical behavior. Customers deserve to have access to high-quality products and services at fair prices, and the practice of vendor kickbacks undermines this fundamental right.

It's incredibly important to note that 33 Sticks does not have ANY partnerships in which we are paid to have a specific opinion about any vendor, in which we receive any financial kickbacks for recommending a vendor, or receive any preferential treatment for stances we take about industry topics or vendor strategies. This is a very unique aspect of our business that allows us to be true advisors for the businesses we support. If we recommend a specific technology or vendor, we do so because we believe it to be best for our client and not because we are being paid by a vendor to do so.