This is one of the most important tasks in many industries, as the final product and its profitability is directly proportional for making the right decisions while choosing a Supplier or Vendor, so I want to start with some facts that will assist you to make the right choice:
-Bargains do not always translate in cost effectiveness or product performance.
-Consistency in products and prices are probably the main characteristics of a good Vendor.
-Globalization is always around; so many Vendors will have the exact same product you are looking for.
-Don’t ever get “married” with one Supplier, as “honeymoon” can turn into “bittermoon”.
-Vendors have a sales quota, make sure to buy what you need, do not overstock your warehouse.
-If you don’t know what products you are looking for, it’s impossible to source the right Supplier, plan in advance.
-Your Purchasing Manager is a real price hunter, no matter quality, if you make the right product specifications, you will end up exactly with what you need.
-Having several Vendors for the same product will only increase your operational costs or expenses, make the right choice only once, but be sure to always have a backup just in case.
And now some things to consider:
+Get prices lists on a regular basis, as nothing that you can’t measure, can’t be improved.
+The best way to source Vendors are through recommendations or referrals.
+Always negotiate, as this will bring a positive effect in your costs.
+Best Suppliers are punctual, formal and deliver consistency.
+Know your Supplier Company Manager; it is the person that will help you in any problem, and make sure you get an open line of communication.
+Performance tests on samples are essential, as unfortunately, almost 80% of the purchased product is different from the one you tested.
+Constantly changing your Vendors will increase your costs, expenses and for sure will give you a major headache. If you made your decision, stick to it.
+Once in a while, pick up the phone for a courtesy call to your Vendor; this will keep them motivated to get the best products at the best prices.
+30% of the products Vendors handle, are not in a price list, ask for them.
+Make sure Vendors have the proper stock to fulfill your needs, otherwise you will end up buying more expensive, remember that Vendors do not overstock or have unlimited supply.
+Delivery conditions, prices negotiation, credit openings and your Vendors follow up is 60% of the process, you might give it some attention.
+Do not receive anything that you didn’t ask for, and if you don’t get what you asked for, send it back and make sure for it respective credit note.
+People represent companies, the best negotiations are always held among people, not companies.
+Source for local Vendors, remember that shipping costs, and it is reflected in the prices.
If you are buying equipment, make sure that you get your Vendor’s point of view, as they can assist you in taking the wisest decision.
If you are a Vendor or Supplier, I ask you cordially not to promote your services or products in this posting, I recommend you to start a new discussion.
To choose a Vendor, do not hesitate, make the right decisions, your business depends on it. Please share your experience.
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