Why It Pays To Research Your Suppliers
One of the major factor to keep your company a success is to have financial stability. It is very important for any company to be stable. As an owner to have stability in finances you always look at the cash flow, profits, etc, but are you paying attention to your suppliers as well? It is very important to know the supplier’s situation at all times as anything happens to your supplier is going to have a huge effect on your company and your finances if you do not have a backup plan. If you are looking for a supplier then you need to do a little research before choosing the suppliers you are going to work with. If you want to change your supplier you must still do the same. But if you already have a supplier you need to start paying attention to their business. In some cases, it is better to always have a backup plan as you never know what the future might bring.
Why you should pay attention to your suppliers
- A good relationship brings trust: You have to build trust with your suppliers for a better relationship with them. Your supplier is the best asset you can have so you need to have an honest communication with them. In return, they will also have an honest communication with you that builds a mutual trust and is going to benefit everyone.
- A better relationship brings better service: When you have a good relationship with your suppliers this means you are going to receive a better service. When you suppliers feel valued they are going to do a better job especially when you need them most, for example when you have a last minute demand a supplier that has a good relationship with you will fulfill your demands but if you don’t have a good relationship, the delay can damage your finances.
- Savings: A good supplier is going to help you save some money. Because they will give you better prices when you have a good relationship with your suppliers. This is a common way of saving money for many companies but you should know that getting huge discounts are not always worth it. Your companies need each other so it is better to make sure that your supplier is not having any financial losses in exchange for your benefits.
- Good reference bring new customers: When you have a good relationship with your suppliers and make them feel valued they start to feel responsible and somehow become a symbol of your company. You should know that being aware of how important your suppliers are to your company will have a huge impact on your new clients.
What to consider when you research your suppliers
- Price: Having a good relationship with your supplier is very good. You can save a lot of money because your supplier will give you a lot of discounts. But you need to consider and see if your supplier profits enough from you or its other customers. Because if your supplier is not making a reasonable money then their whole company will be at risk. And you must always remember that your supplier’s situation will affect you greatly. Especially if you do not have a backup supplier. So the first thing you need to do is to make sure your supplier is in a situation when their company is not at risk. And secondly, you need to come up with a backup plan and make sure that if anything happens you have another supplier to go to.
- Service: Your supplier’s services are going to have a direct effect on the quality of your products and your customer satisfaction. Make sure that your supplier is providing you a service that is going to benefit you. Your benefit means your supplier benefit as well. This is a win-win situation. The more satisfied customers you have the more your profits will be.
- Quality: You need to check and see if the quality of the supplies that your suppliers deliver is going to satisfied customers. Some people check for labels and packaging as well as other qualities. Research about the financial losses your supplier has over these categories.
- Alignment: It is very important that your supplier is aligned with you. You have to always expect a supplier to suddenly decide to stop providing you supplies. If you are not aligned with them then their decision is going to come as a surprise to you and affect your company. If you are, however, aligned with your suppliers you can help them grow more and they can help you grow more. To achieve this you need to come up with customer insights, additional tools and anything you can do to make your businesses better than before.
- Owner: Finding out who the owner of your supplier is can help you learn so much about their company. First, you can get to know the owner if it is possible. From the decisions that the owner makes you can understand what kind of business strategies he uses. This helps you predict the future of your supplier’s company up to some point.
It is very important for you to get to know your current suppliers or the suppliers you want to work with, in the future. You should make sure of how big their company is or how stable their finances are and always keep an eye on their profits and the quality of the products. Remember that your supplier is your best asset, keep them close and make sure their company is doing alright.