7 tips to avoid making mistakes when choosing suppliers

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7 tips to avoid making mistakes when choosing suppliers

One of the most important decisions a company makes regarding production concerns the choice of suppliers. You need to select carefully, research and plan, as any supply problems can affect your company's productivity. Therefore, prioritize reliable suppliers that are aligned with your company's quality and objectives.

But how can you avoid problems when selecting sources of supply? Here are some tips to help you throughout the supplier selection process. Keep reading!

 

Tips for choosing suppliers

Look for suppliers with goals aligned with yours

The first step in choosing suppliers is to look for companies that have goals aligned with your own company. This will make the business relationship easier, as you will have common ground in terms of business. That's why collaboration is an important issue in B2B relationships.

For example, if your company values sustainability process may have the reputation affected if you buy from a supplier whose business contributes to increasing air pollution. Only select those who have common ground with your company and who will form a better business partnership.

Check the budget and possible profits

Any decision must take into account how much will be spent on a given action and how much profit can be made from it. When it comes to choosing suppliers, the situation is no different. After choosing options that are aligned with your company, get quotes from each of the supply sources and analyze which proposal is most in line with your company's financial reality.

In addition, it is necessary to fully understand the impact of acquisitions on the products or services offered on the market by your company. With this information in hand, it becomes clearer which are the best options for establishing a commercial partnership for your business.

Make it clear what you need

A supplier may supply the same product to different companies, but each one has its own expectations and needs. Therefore, even those that you consider ideal and that have been on the market for a long time, are not capable of providing the essential inputs for your production without receiving a request with the correct information.

Communicate in a transparent and informative manner what you need to purchase, how your company operates and what the delivery deadlines are. This will help you know whether the supplier is able to meet your requests and the business partnership will meet more realistic expectations.

Value communication between companies

Most supply chain issues involve situations beyond your control. Therefore, it is essential that when choosing suppliers, communication between companies is a priority.

You need accessible, organized and serious partners, capable of helping in situations where things get out of control and cause problems for your company. Incidents tend to decrease considerably when there is a good business relationship with suppliers and the solution will be much more efficient and quicker.

If you don’t feel confident about a potential supplier, they’re probably not an interesting option. But remember that trust is a two-way street, and just as you expect trust from your supplier, they should feel the same way about your company.

There are currently several platforms available on the market for hiring, evaluating and approving suppliers. Check which one best suits your business needs.

Analyze the quality of the product

Just as your suppliers must have objectives aligned with those of your company, the same must happen with the products supplied. The quality must be of the same standard as that of the product or service you will offer on the market.

A bad purchase or the acquisition of a product of inferior quality can cause huge losses for the company and even stop its production line. And the end result could be a less competitive product that risks being unsold in stores.

Research the vendor's reputation

During the process of choosing suppliers, it is a good idea to contact companies that you are interested in establishing a business partnership with. Ask about the business relationship, the quality of the product/service provided and the support offered by the supplier. The length of time they have been in the market should also be taken into account.

Also, do some research online to find additional information. This will help you better understand the supplier’s history, its positioning in the market and its reputation among customers.

Don't depend on a single supplier

It is essential to trust your suppliers, but never do so without having verified their reliability. Unforeseen events, failures, mistakes and errors can happen in any business. Therefore, have a plan B for the supply of products and services that your company needs.

 

Did you like the tips? Leave a comment about your experience with supplier selection!

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