When this quote by John Ruskin appeared on a recent LinkedIn post, it led me to think about the best approach for a business considering changing suppliers.
It’s unwise to pay too much, but it’s also unwise to pay too little. When you pay too much, you lose a little money, this is all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do. The common law of business balance prohibits paying a little and getting a lot – it can’t be done. If you deal with the lowest bidder, it is well to add something for the risk you run. And if you do that, you will have enough to pay for something better.
John Ruskin (1819 – 1900)
With the phrase, “Buyer Beware,” in the back of my mind, these are some thoughts I jotted down.
Businesses will always be motivated to change when they need to solve a specific performance problem. The change could be based on internal or external personnel, geographic location, regulatory requirements, or the economy, to name but a few.
These are the three main factors I believe that trigger the need for a business to change as they search for:
- A Higher Quality Performance Product.
- Excellent Service and Response Times.
- The Lowest Priced Service or Product.
In a cooling economy, some may focus mainly on # 3. Is it possible to achieve all these factors in a long term supply partnership? I will let the readers of this article decide.
Without the correct research, switching key suppliers for any reason can be costly and sometimes high risk to a business when it comes to a potential area of poor performance. Complicating matters is the fact that not all potential issues in switching suppliers will be obvious on the surface.
How does a Business Research a New Potential Supplier?
Here are just a few points l believe you should look at from every major supplier you engage in your business who forms an integral part of your success:
- Will they actively prevent issues with quality and service?
- Will they continually meet your tight deadlines?
- Do they fully understand your business and the part they will play?
- Does their culture and their communication align with your own?
- Is their buying process easy so it does not impact an area of your operation?
- Will they consistently meet your high level of expectations?
- Are they recognized for being proactive in increased efficiencies?
- What areas of the supply could impact you financially during the change?
What is the most important factor for your business when you look at changing suppliers?
Keith Tindall – Board Director, General Manager, Entrepreneur, Business Coach and Mentor, and likely the worst golfer you will ever play with.