getting ones supply chain in order can be a tough nut to crack. And lets be honest, there are always something to improve in the way your supply chain is setup. These days, new tools and techniques are popping up everywhere and the tactics of how to keep you supply chain lean and efficient are constantly shifting. For any healthy supply chain it is imperative to have a well functioning portfolio of reliable suppliers and our team at Sathive, have put together these
6 Tips for finding new suppliers
which will, hopefully, help you in finding new reliable partners to bring your business to the next level.
1. Online presence
First thing you should pay attention to is if the supplier has an updated and informative website. These days not having a website simply means that supplier does not care to be represented in the 21st century and most likely will have the same negligence in other areas of their business. By having a website that displays their services, supplier shows that they are open for new business and show awareness of e-systems and how to use them.
Usually, a well built website would be enough to start initial contact, if it has all the required information.
This is very important if you are looking for a smaller quantity production. Good supplier location could mean shorter shipping. Closer cultural match between you and the supplier. And ease of doing business.
By choosing a supplier that is close by, you can ensure you produce in smaller batches thus, saving on stock, storage and shipping costs. It is obvious that manufacturing off-shore is getting more expensive so there is no reason not to explore near-shoring opportunities.
3. Referrals, extended network or due diligence
One of the most under-looked opportunities are within your existing extended notwork. There is a high chance that one of your partners already did the hard work for you. So you should always ask is somebody can refer you a contact from a supplier they know or used.
Another way of doing this is looking at any reviews or referrals that other companies left for the specific suppliers. As consumers we always look for reviews on products we buy and it is only natural that same applies for businesses.
If none of the above points are an option you can always ask the supplier to refer you to any of their existing clients. If they refuse, it might be a red flag.
4. Match their size to yours
If you are a small company negotiating with a large supplier you can expect to be neglected. Chances are, that they already have some big clients, which will always come before the small ones. This also applies to vice versa. If you are a large company working with a small supplier, there might be issues with delivery times and capacity.
Therefore, you should try to match your supplier size to yours. Roughly… This means that your needs and their ability to deliver matches . This would result in a healthier relationship, more satisfaction and consequentially better results.
Note, that there are exceptions and conditions out of your control. So in some cases mismatch in size can be positive, yet certain precautions should be taken.
5. Make sure you are dealing with a manufacturer
Sometimes you would find out that your supplier does not produce or provide the service you are buying himself, but re-sells what others made. In such a case you are dealing with a re-seller. What does that mean? It simply means you are paying twice for service which could be done much better. This means that communication lines are longer and every service that you purchase get a double margin.
Make sure you are dealing directly with the manufacturer and cut your costs from the very start.
6. Communication and trasparency
Transparent communication is critical in establishing trust with your suppliers. In many cases your cooperation will be built on mutual trust rather than contracts, especially if you are a smaller company.
Although, it is not easy to find or establish a trusting and transparent relationship, it is important to put effort in doing so. Usually this will be based on a feeling and will not be appearant, before you worked with a company for a little while. Yet, having references from other companies in a form of review or direct connection can help you avoid possible cooperation issues in the future.
Congrats! You have made it to the end. We hope these tips can help you find your next supplier and will help you to establish healthy lasting relationship between two companies. Do not forget to follow us on LinkedIn or Facebook for more content. Have a look at other posts related to e-sourcing and Supply Chain.