6 Things to Look for in a Materials Supplier
Finding a materials supplier for your business can be challenging, especially if you run a manufacturing business. Plagued with soaring prices, diminishing raw materials, prolonged inflation, pandemic-induced broken supply chains, shortages, and global political unrest, choosing the right supplier for your business is the key. You want to choose one that provides efficiency, speed, and the highest quality.
Materials suppliers are important to your business’ success. They play a role in every stage of production — from sourcing raw materials to ramping up production to fulfilling your business orders. The relationship between suppliers and businesses is crucial.
Follow this ultimate guide when choosing a materials supplier to ensure you end up with a vendor you can trust.
Know What Your Business Needs
First, it’s important to start with the basics and determine your business needs. Whether it’s wood to build homes or award plaques to gift employees at an event, consult with your teams to know what is needed and take an inventory of what you already have. Starting with a good understanding of what you have and what you need will also help you cut costs in the long-run, preventing you from ordering too much or too little.
Next, talk with your accountant, chief financial officer, or whoever oversees funds, about what is attainable and within budget. Determine if you prefer a wholesaler or third-party logistics provider.
Note: It’s important to think long-term. Ideally, you choose a materials supplier and work with them for an extended period. You’ve heard it before: relationships are important in business. When you have a long-term relationship with a supplier, it becomes easier to fulfill and place orders. And they can help your business achieve more goals, such as expanding globally.
Here’s how to determine whether or not your materials supplier will be in it for the long haul.
What to Look for in a Materials Supplier
It is essential to have dependable and high-quality materials suppliers when running a successful business. These tips will help you find the best supplier to meet your needs, whether you’re a small startup or a large corporation.
When selecting a materials supplier, reliability is an important factor to consider. This refers to the supplier’s ability to consistently deliver high-quality materials on time and in the quantities required. A dependable supplier will allow for the smooth and timely completion of all projects. A supplier who delivers broken or faulty supplies or arrives late with the materials you need simply cannot be trusted to keep your business afloat. Reliability is key with materials suppliers.
When choosing a materials supplier, trust is essential. Building trust with a supplier takes time and effort, which is critical to developing a good working relationship. When evaluating potential suppliers, consider their reputation, willingness to provide references, and the transparency of their business practices. You must ask yourself: Can I trust this person or company? Your strategic sourcing significantly impacts your projects’ success, so choosing a supplier you can trust is important.
High-quality business starts with your suppliers. After all, poor service or quality is associated with your company — not the suppliers behind the scenes. Ensure top-quality materials to ensure top-quality business and avoid letting your customers down.
4. Financial Security
However, high quality does not always require paying the highest price. It will take some time and strategy to find the balance of quality and price that works best for your business, but it is possible.
Suppliers’ pricing also accounts for timeliness. You want to pay for a supplier that offers speedy results. And on the flip side, you want to ensure your supplier is financially secure. You don’t want your supplier going bankrupt and leaving your company high and dry.
A supplier that provides results in a timely fashion is key. Find suppliers who can quickly respond to customer and business demands, including emergencies. This involves a level of proactiveness and organization as well.
6. Clear communication
You need to find suppliers who will notify you of a problem quickly and give you frequent updates on shipments. Honest and open communication keeps the business running. That available line for regular communication also allows them to understand your future needs and how you can improve the operations.
So now that you know what you should look for in a supplier, let’s talk about how to find one!
How to Find a Supplier
To find the best materials supplier, start with a shortlist of possibilities. After you have determined what you need to buy, create a shortlist. Ask your friends and business partners for recommendations, consult with a trade association, look to your business advisors for advice, or attend exhibitions.
Next, approach those materials suppliers. Be able to communicate your needs and requirements upfront. Then ask them if they can supply it and meet your needs. Compare the responses to determine which material supplier is best for your business.
Now that you have determined which suppliers to work with, it is time to negotiate your terms.
Set clear goals and communicate boundaries. Think through things such as payment schedule, price, delivery schedule, and frequency. The supplier will do the same. Hash out any differences or concerns early on. Use your bargaining power to get the best deal for your business.
Once an agreement is reached, it’s time to draft the service-level agreement. These agreements are part of supplier contracts and typically outline the following:
- Payment conditions
- Standards of service
- Delivery schedule
- Performance review terms
- Any confidentiality or non-disclosure agreements
- Conditions for termination
Some suppliers will have standard service level agreements for all business relationships. Ensure your needs are being addressed.
Knowing how to find the right materials supplier for your business is essential and doing your due diligence upfront will always pay off in the end.
Mike Szczesny is the owner and vice president of EDCO Awards & Specialties, a dedicated supplier of employee recognition products, branded merchandise, athletic awards and award plaques. Szczesny takes pride in EDCO’s ability to help companies go the extra mile in expressing gratitude and appreciation to their employees. He resides in Fort Lauderdale, Florida.