Whether you’re looking for supplies to maintain a clean and sanitary facility, supplies and equipment to keep your associates safe on the job, packaging supplies, or warehouse and industrial equipment, this guide will help you find the right supplier and begin a great relationship.
Of course, every business needs suppliers. Unlike raw materials you need to manufacture what you resell, facility supplies help keep your operations running safely and effectively on a daily basis. You can certainly run an operation without them, but they are the glue that holds a facility together.
Vendors and suppliers can do much more than supply you with the materials you need to do business. Often, they are important sources of information:
- Product details so you can use their products in the most effective manner possible
- Tips and tricks to control your maintenance costs
- Operational tips that can help you run a more effective and efficient operation (and that often have nothing to do with their products)
- Information to help you evaluate the potential of new products and make a proper selection for your business needs
Sizing Up Your Suppliers and Vendors
We divide suppliers into four basic categories, which include:
- Manufacturers. Many companies buy supplies directly from a manufacturer’s channel, via a company salesperson. There are also independent representatives who handle goods from multiple companies. This is usually the best source for lowest price. Sometimes, however, requirements to purchase in bulk or shipping costs can kill any price advantage.
- Distributors. Next step down in the supplier food chain is distributors, also called brokers or wholesalers. They buy in quantity from multiple manufacturers and maintain an inventory of goods in their local warehouse for quick delivery. Their prices are always higher than a manufacturer (they have overhead, too) but a lower shipping cost and on-demand delivery more than compensates for the higher cost.
- Independent Craftspeople. Unique products are frequently offered by independent craftspeople who sell through reps or trade shows. Often your only source for a particular product, but the cost of their goods are usually high because of their limited distribution channels.
- Import Sources. It’s not unheard of for a company to visit world marketplaces like China or Viet Nam to source their own products. The penalty is the high upfront requirement of purchasing in bulk. Other options include an importer who provides the same service. Either way, you’ll probably be buying a container load of product.
What is the Definition of a Good Supplier?
Many growing companies focus solely on a single aspect of their suppliers, namely price.
Of course, price is important as you source suppliers to help you maintain or grow your business. But there is much more to the equation that just price (which we’ll examine shortly). Keep in mind that like your business, your vendors are in business to earn a profit. You can’t expect to continually beat them up on price for the long term and expect great service. It’s just human nature. Eventually, they may want to stop selling to your company.
Reliability. Reliability is our number one factor by which we measure suppliers. The best vendors will ship an accurate number of items, delivered on time, and arrive at your location intact.
We’ve done business with larger companies because they have the resources to come through when something goes wrong. Many times, their policies are rigid and they may not be able to provide what you need, when you need it, at a price that works for you.
Small to mid-size suppliers shouldn’t be overlooked. Being a large customer of a smaller company affords you the luxury of being able to dictate terms, get better service and quick results when you need them the most.
Some companies have a policy of splitting orders between multiple suppliers, i.e. two smaller vendors. This is a great strategy if you can find two reliable, cost effective sources for the products your business needs to maintain safety, healthy, clean work environments.
Stability. Next on the list of key factors is stability. It’s generally a good idea to do business with suppliers who have been around for a number of years, who have processes and people in place to give you the best service. Also having experienced upper management is another good sign.
A solid reputation with other customers is another positive attribute. We often check out potential vendors’ online reputation to be sure they are meeting the mark.
Keep an eye out for vendor trouble, such as early delivery (and invoicing) to accelerate their cash receipts.
Location. Proximity to your facility is another key factor for choosing a vendor. Even if you get the best price on the planet, and pay a minimal amount for shipping, if your supplier is far away you may not be able to get the supplies you need in time. Many vendors offer free ground shipping but may charge for rush delivery. It’s important to determine your supplier’s shipping policies before you order (or perhaps before you hire them) so you’re not left holding the bag for a huge freight bill.
You best bet is to find a supplier close by that offers the product lines that you need to maintain a safe and healthy work environment at your facility. Alternatively, if the supplier has warehouse locations in your city and other cities, they can probably provide the best service.
Competency. The final key factor: simple competency.
- It’s important to do business with a vendor that offers product lines that comply with current health and safety requirements in your area. You’ll want to work with companies that offer updated, modern products.
- The supplier should have a courteous/friendly, eager, well-trained, helpful staff that can service your needs in a reasonable time period.
- They should offer attractive financial terms on your purchases
Change Your Vendor Relationships
If you’re not satisfied with your current vendors, you may not have to make a change to a new company to get a new deal. Sometimes you can obtain discounts, special pricing or terms, or improved service simply by asking. You may have to negotiate to get what you want.
- Obtain Discounts. Unlike retail shopping (in the US at least), business transactions are usually a bit more flexible in terms of price. Many companies offer discounts or more favorable terms for larger quantities purchased, long-term contracts or commitments. Ask your current vendor about discounts and what you need to do to earn them. It’s possible to obtain a substantial discount for paying early, or obtain the equivalent of an interest-free loan in the form of trade credit.
- Improving Service. If you have a service-related problem with your supplier, bring it their attention. It’s impossible for a manager to control every facet of their business all the time. Of course, if you don’t get satisfaction, move up the chain of command until you get results. If you ask for better service, and don’t receive it, then it’s fair to end the relationship.
- A Better Relationship. Not every customer wants to have a buddy-buddy relationship with their suppliers; many are happy to get good products and services at a decent price. If you prefer a more close-knit relationship with your vendor, by all means let them know. Most companies will gladly accommodate your needs (and any extra hand-holding you need) to maintain the relationship and revenue from your business.
When It’s Time for a Change
All things being equal, it’s best to have the fewest number of vendors as possible. Putting all your eggs in one basket for your facility’s sanitation, maintenance and safety supplies will net you considerable savings, better service and help control costs. If your supplier isn’t making the cut, it’s a necessary evil to just make a clean break sometimes. When you’re ready to make a change, keep these following tips in mind:
- Lack of Reliability. When a vendor makes frequent mistakes in your orders, misses deadlines, botches the billing for their services, it’s time for a change. Every company can have a bad day, but if the issues continue for a while, there’s no question you should switch vendors. Try working with them to correct the problem, but if things don’t improve, move on. Keep in mind that if you stick with a vendor through tough times, they may cut you a break when you are having a cash flow crisis.
- Prices aren’t Competitive. When you receive a significantly lower price quote from your vendor’s competitors, it’s time to investigate further. Sometimes, companies are just behind the times, don’t maintain their pricing competitiveness, or just can’t compete because of their suppliers. If you have a good working relationship with your vendor, bring the discrepancy to their attention and see if they’ll work with you. If they can’t match the pricing or offer another concession, look at the competition a little more closely.
- Lack of Transparency. Some companies will allow you to visit their facilities, talk to their rank and file workers and managers, speak with third party references or other customers… these are all good things. If your supplier doesn’t allow you to see as much detail as you need to make fair comparisons with their competitors, it might be time for change.
- Internal Costs Connected with the Sale. You have your own costs associated with doing business with any vendors, from time spent generating specifications, issue request for proposals, review them, follow up with references, and qualify potential suppliers. Then, you’ll have to place an order, negotiate terms, inspect the order when it arrives, and deal with shortages or damage. You may also have to train your employees to deal with a particular vendor’s ordering or fulfillment system, purchase equipment to handle the incoming orders, make modifications to your facility to accommodate the vendor. If any of these costs drive the total cost of doing business with a specific vendor too high, you may consider switching to another vendor that can make your job easier.
If you’re in the market for janitorial/sanitation, safety, packaging and/or industrial and warehouse equipment, Unisan fits the bill. Find out more about Unisan Columbus or Contact Us to see how we can fulfill your supplies distribution needs today.