What to look for in your suppliers?
Choosing your next product or service supplier can be a daunting task. Procurement best practices have evolved such that supplier selections can no longer be based on price alone. Now, it’s important to find a partner that delivers value, is dependable, offers expertise, aligns with your organisation’s core beliefs and so much more.
What makes a good supplier?
When choosing and negotiating with suppliers, you need to consider a few factors. How you weigh up the importance of these factors will depend on your business priorities and strategy.
- Accountability for quality: A supplier with accountability will take responsibility for the quality and work forward to address it quickly.
- Production capabilities: A quality supplier should be able to consistently manufacture a product that meets your requirements.
- Compliant with regulations: They need to produce products ethically and follow all regulations in the country of manufacture.
- Quality and reliability: The quality of your supplies needs to be consistent your customers associate poor quality with you, not your suppliers. Equally, if your supplier lets you down with a late delivery or faulty supplies, you may let your customer down.
- Speed and flexibility: Flexible suppliers help you respond quickly to changing customer demands and sudden emergencies.
- Ease of communication: Effective communication can prevent a variety of problems ranging from production delays to product nonconformities.
How to go about selecting the right supplier?
Step 1: Set your criteria
Create a list of criteria your supplier will need to meet to provide what you need including quality, capabilities, and policies because price can not be your only criteria.
Step 2: Scan the market
Once you have prepared your list of criteria, this will make a particular supplier a strong potential partner. Compare the information you receive from the suppliers with your list. This should help you narrow down your list to three-to-five contenders. It is also important to consider their reputation in the market.
Step 3: Dig down deeper
Now it is time to ‘suss’ out your short list. Ask about potential suppliers’ raw materials planning and sourcing. Try to identify if the vendor uses any risky reordering practices or gets its materials from unreliable suppliers. Ask them about their delivery and payment terms too so you know exactly what you are getting yourself into.
Step 4: Check the facts
It’s also important to protect yourself by doing your due diligence to ensure you’re working with a legitimate vendor. Call references too, to verify the supplier’s critical capabilities.
Step 5: Select the right supplier
Work with them to develop a contract that benefits both parties. For clarity, be sure to include elements about the project scope and other expectations, and how success will be measured and how often the supplier agreement will be reviewed which should be formalised in a Service Level Agreement (SLA).
Find and keep them
To find and keep the right suppliers, from the onset it is important to meet them face-to-face and see how their business operates. Understanding how your supplier works gives you a better sense of how it can benefit your business.
It is also important that you have regular contact with them and update them on strategic changes or new products early on. This helps them adapt to meet those changes.
Ask them about any plans for development or expansion. Will this affect the goods or services they are providing to you?
Also help your suppliers by placing orders in good time, being clear about deadlines and paying on time.
Make your business important to your suppliers and they will work harder for you. Some suppliers may offer better deals if you promise to use them exclusively. However, this may cause significant problems if they go out of business, so be aware.
Golden Spices, we care for our suppliers too
At Golden Spices it is our business to supply high quality products to all our customers.
If you would like to know more about the range of products we have to offer, get in touch with us at: info@goldenspices.co.za
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