Supplier Assessment - Are Your Current Suppliers Draining Your Profits?
To control business expenses, you must ensure that you are getting the best the market has to offer. Just because you've had your current supplier for quite a while, doesn't mean they are the best one for your business. For all you know, you can get the same (or even better) quality at half the price from another supplier.
Questions To Ask Yourself About Your Supplier
Your current supplier(s) may be causing a leak in your business profits. To ensure that this is not the case, ask yourself the following.
1. Are the rates offered by your current supplier(s) competitive in the market? If you have been dealing with your suppliers for years, it's worth checking out how much others are offering now. If you find out that others are charging lower rates, discuss this with your suppliers. They might just lower their rates to keep your business.
2. How is the supplier's overall quality? Are you indeed happy with the products and services being provided so far?
3. Is your supplier reliable? For instance, the rates may be good but if he is always late with deliveries and your business is time-sensitive, then this also entails expenses on your part right?
4. Take note of features and inclusions. Is your current supplier giving you special discounts.
5. Are there any restrictions at all with your current supplier such as minimum required orders, shipping constraints, or absence of a return policy?
Even if your product or service provider comes out looking good after you answer the above questions, it's still important to start checking out other suppliers even if only for the purpose of comparing them with what you have now.
As the 'client', you will see that your current supplier will do his best to keep your business. However, do not let sentiment get in the way if you realize that you can really get a much better deal elsewhere. Remember, it's not personal... just business.
Action Steps to Small Business Savings via Supplier Assessment
1. Evaluate your current providers and supplier by asking the questions listed above.
2. Start checking out other suppliers in your area.
3. Compare your current suppliers with the news ones you have found and see which one(s) can provide you with the best deal.
Important Points to Small Business Savings via Supplier Assessment
- Even if you do not change your suppliers, knowing current market trends will help you discuss and possibly improve your current arrangement with your supplier.
- Even if you are 'happy' with your suppliers, it's still worthwhile to shop around for other suppliers even if just for comparison.
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