I’ve found the perfect supplier, but how do I safeguard my business?
I’ve found a supplier who has exactly the products I wish to sell.
But they can be quite unreliable with their delivery times/amounts. Communication isn’t really their strong point. What can I do to safeguard my business?
When you find a good, reliable supplier who has exactly what you want it’s imperative you work really hard to build a solid relationship.
Treat your new supplier with the same delicacy that you would a new customer. Communication is of paramount importance.
As a new customer, you will very rarely get the same kind of attention a long-standing customer gets.
In time you can develop working relationships that will work for both you and your suppliers.
In an effort to establish a good working relationship make sure you play all your cards right. Work out your discounts and pricing before you begin ordering.
Try to get a price list from them as well as a discount for quantity. That way you aren't haggling with the supplier for a better price every time you order.
The same goes for payment terms. It's crucial you pay promptly because if your supplier has to struggle to get their bills paid they are probably not going to take very good care of your account.
If for some reason you can't pay them on time, be transparent about it.
If it's possible then go and meet with them face to face try and ask for an account manager so you have a single point of contact.
Try to give your supplier as much lead time as possible. Discuss your needs and expectations so they can have a better understanding of what your requirements are.
You could work out how much stock you think you may need for a certain period, share your projections with your supplier so they can accommodate your needs.
In terms of safeguarding your business there are a few things you can do.
I would be quite hesitant to have a sole supplier as the risk is way too big. Sometimes for reasons beyond their control they might not be able to supply within your time frame required.
It's worth spending the time finding a back up supplier.
Make sure that you get samples of the product required before purchasing. Also be very specific when ordering so that both parties are very clear on what is expected.
You could try working out a purchasing procedure where you take into account supply time, potential delays and sales projections. This way you are protecting yourself from stock shortages.
Developing supplier relationships shouldn't be a complicated process, but they need to maintained constantly as it is one of the most crucial relationships you have.
So be firm, open, loyal and communicative and it should work well for everyone. If you find that your supplier is letting you down, then it's time to cut your losses and move on.