Having reliable and efficient suppliers are essential to having a successful business.
Suppliers are essential to almost every business, they not only provide you with materials, but they also help to provide internet access, stationery and perhaps even the coffee you drink. That is why having reliable and efficient suppliers are essential to having a successful business. However, trying to find such suppliers isn’t always straightforward, and your relationships with suppliers can sometimes become strained. Here are a few tips on how you can find and work with the right suppliers for your company.
Types of Supplier
There are many types of a supplier that you will need to keep your company working. You will need to have some or maybe all of them, so you need to do your research before you choose the right ones. The first type you will use are manufacturers; these are usually dealt with by a sales representative. These reps often represent many companies, so you need to make sure they know enough about the products. The next is distributors; you might deal with these from more than one angle. Distributors typically hold stock from several different manufacturers and then sell this on to retailers. If you are a manufacturer, you might deal with distributors to sell your materials or products. If you are in retail, then you will most likely deal with the opposite side. Other types of supplier you might deal with are independent craftspeople, especially if they are making something for your products. The other type is import sources. These are typically similar to distributors, except they ship goods to other countries from various manufacturers.
What Makes a Good Supplier?
When many companies look to find a supplier, they primarily focus on the cost. It is no surprise because they are looking at their profit margins and don’t want to spend too much on materials. However, there are other considerations that you need to take into account that are just as important. Apart from price, you also need the supplier to be reliable. For example, if you have just started a new internet provider for your company, you need them to give you a reliable connection to do business. If your connection keeps failing, then this is not good for you even if they are the cheapest. Companies such as Custom Fittings Ltd are seasoned suppliers so they will be a reliable example. Read into the company background to see what their history is. Another key factor is stability, as you will be relying on these suppliers to get you the products you order as quickly as possible. If they are always running out of stock or are having cash flow issues, this will impact on your business as well. You also need to think about the location of your suppliers, those with more distance from you will take longer and cost more in shipping. Imports will probably cost the most and take the longest, so you need to factor this in when you are ordering.
Altering Your Supplier Relationship
If you are finding that your suppliers are not giving you what you need, you don’t necessarily need to cancel your contract with them. Many suppliers are happy to discuss the needs of their clients and will often make arrangements to deal with their requests. Even if you think that your needs cannot be met by them, it is good practice to at least offer them the opportunity to make things right. You might find issues initially when dealing with new or small suppliers. They might not have dealt with a company your size before, so you need to tell them if things are not right and give them the opportunity to fix it. One of the most frequent problems you will have is price, perhaps your business isn’t going as well as you had hoped, and you need to think about cutting costs. One way to achieve this is by rearranging the terms with your suppliers. You shouldn’t automatically assume that your existing suppliers won’t agree to discounts. If you have been a loyal customer to them, they will likely be able to come to an arrangement with you. This is a better resolution to the problem than looking for new suppliers as they already know you and you have a relationship already in place.
Changing a Supplier
There are, of course, times when you will need to think about changing a supplier. It isn’t an easy decision to make, but in the end, you need to think about your own business needs. Some of the reasons you might want to terminate a contract are unreliability, extra costs, lack of openness or lack of quality. These are factors you should have worked out at the beginning. As a company, you need to thoroughly assess and check each supplier you look at to see if they are capable of meeting your needs. For example, if you find that they are always failing to get your goods to you on time, then this is something you should have looked at before making the agreement. Talk to other companies that use this supplier, are they happy with the service they are getting? Try and see the factory where your supplier works, see what their workers think and if their set-up seems efficient and well run. If you are denied access to their warehouse, or they won’t allow you to speak to the staff, then this should be a warning to you. Even though you are not happy with an existing supplier, you still need to deal with it professionally. Look at the terms of your agreement and see what the cancellation period is. You can then start the process of giving them the appropriate notice. If you don’t, they could have grounds to seek compensation from you.
Dealing with suppliers is not easy, but if you can develop a good relationship with your suppliers, you can start to make an effective team that works in the best interests of each other.
