Solving supplier problems
Problem 3: Not getting the best out of your suppliers
For many businesses, in order to provide a product or service to a customer they have to order raw materials from their suppliers. Trying to balance demand from your customers and the ability to purchase materials can be tough. Sudden increases in demand can leave you needing additional supplies, but without the funds to make the purchase.
Here are a few tips to make sure you get the best out of your suppliers.
Get to know your suppliers
The most important tip is to build a good relationship with your suppliers. They are key to making sure you can do business with your customers. Get to know each other and how you work. Building a strong business relationship with your suppliers can only be beneficial. If you need to ask a favour or organise a delivery at short notice, you may just have a better chance of your supplier going the extra mile if you’ve got that relationship!
2. Negotiate your terms
Make sure you’re clear about your supplier’s payment terms. Are you going to be able to make payments based on your supplier’s terms? If not, see what can be done. Having open lines of communication gives you the opportunity to explain your situation, and even make slight payment adjustments; so when your supplier invoice is received you won’t necessarily dread the thought of paying.
3. Bulk buy discounts
If you don’t ask, you don’t get! There’s nothing wrong with making sure you get the best value for money when making your purchases. Some suppliers may be able to offer discounts for larger orders, plus remember you could be making savings on delivery charges.
4. Shop around
When was the last time you did a comparison on your prices? There’s no harm in every now and again just getting some quotes from different suppliers. See what’s out there and importantly, see how much it costs! It is an investment in your time, but it could be worth it in the long run if you end up making savings.
5. Supplier finance funding
There may be occasions when you need funding immediately to meet a tight turnaround or place a larger than usual order. This will quite often call for a certain level of cash availability. Certain business funding options, such as supplier finance are geared exactly for this possibility. It’s all about giving a bit of breathing space to the situation to allow you to say yes to larger orders!
Suppliers are an integral part of any business. Working closely with them and making sure you get the best out of them will benefit your business.
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