Choosing the right business suppliers for you business can be tough. It’s incredibly important to know how to balance out your needs from your wants so you can form a successful partnerships with your vendors. It can be easy to distracted by the finished project and end goal; however there is so much more to consider. Here’s a quick guide on how to choose the best business supplier for your business.
Make a List
There’s a lot that goes into the merchandising process and it’s important to think about how your merchandise will move through the production stages as well as how it will end up in your customer’s hands. Make a list of all of your wants and needs in supplier and rank them as most important to least important. Regulations and standards may vary from industry to industry however, here are some universal concerns to take into account:
Lead time,
Maximum/minimum requirements and limits,
Drop shipping capability,
Quality and quality assurance process,
Payment terms and conditions,
Return policy (for you and your customers), and
Communication/responsiveness.
Research Suppliers
There are business supplier directories that list suppliers by name and business type. Search the directories to find business suppliers that offer what you need and after compiling a list, compare and evaluate them according to the list you made prior to shopping. Research the company’s reputation, how their clients enjoy working with them, as well as if they provide business security features. A good business supplier would offer their clients insurance and fraud protection.
Place Bids
Many suppliers require that you fill out a Request for Proposal (RFP) or Request for Quotation (RFQ). Be sure to include every little detail that you’re specifically looking for, in design and in quality and service. This is a great time to go over the supplier’s production process and policies so be specific about delivery dates and how many pieces you need and are able to, or have to, order.
Review Bids
Compare and evaluate the business suppliers’ responses. Take note of the quality, packaging, timeline and how it made you feel opening your merchandise. Discard the suppliers that don’t reach your quality standards and are outside of your budget. Be mindful of your profit margins when negotiating pricing. Have a professional look over your contract if you have any questions.
Frequently Evaluate Your Supplier
You should routinely check-in and evaluate your supplier to make sure they are upholding their end of the contract: meeting quality standards and delivery/production timelines and goals. If they are regularly shipping items late, or not meeting quality standards, reach out and have a conversation about what can be done. If the problem persists, see about terminating your contract. It’s also a good idea to routinely monitor the cost efficiency of your contract. If the costs of materials, or supply and demand changes (positively or negatively) create a plan to make the necessary and appropriate adjustments.
Be clear and direct about what you need and what you expect. Business suppliers run a business too and the relationship should be mutually beneficial and professional for you both. If you need more information on choosing a supplier, or want to get started, contact First Source Capital today.
