Checklist: Finding the right supplier for your business

Pretty obvious this one isn’t it? Ask the supplier to quote for different quantities. e.g delivering one day of training compared to delivering 10 days; supplying 500 widgets compared to 5,000; supplying five pies compared to 50.

Your supplier might quote you a fantastically low price, but you need to make sure the quality’s right. It’s no good getting your widgets at a knock-down price, if they fall apart after a year or two. Find ways to evaluate the quality of the supplier’s work or products, such as asking for samples, customer endorsements, etc. Where appropriate, ask to visit them at their premises and see for yourself what quality control measures they take.

Ask the supplier what’s their minimum order quantity. Being able to order frequently and in low quantities, (‘just in time’) means that you don’t have to tie up a lot of working capital in stock, nor have large storage facilities. However, the cost to the supplier of production, and/or delivery of very low quantities might rocket up the price.

How long would it take from the time and date the order is issued until they actually deliver it? Would this vary according to precisely what’s being ordered? E.g. if they need to ship goods in from abroad this could take longer than sourcing locally. If they’re manufacturing a bespoke product for you, how long will it take them to tool-up?

Will they give you credit, and if so how much? How many days would they give you to pay their invoice? If you pay promptly, would you get a discount? If you pay up-front for the first order, would they be willing to give you credit on future orders?

You need to be confident that your supplier isn’t going to suddenly go insolvent and leave you in the lurch. Take out credit checks with an agency, or request copies of their latest accounts from Companies House (but bear in mind that the supplier’s situation might have changed since the accounts were filed). If you pay in advance and the supplier’s business goes under, your chances of getting your money back might be slim.

Does the supplier have the infrastructure to cope with your business? If you’re only ordering a small number of items or commissioning small amounts of work it’s unlikely to be a problem. But if you, or another customer, are placing significant orders, will they be able to cope? If they’re planning to hire more staff, buy more kit, or sub-contract work, can they do this and still maintain the required quality?

When you’re checking out prospective suppliers, pay careful attention to how they deal with you – this may be a good indicator of how they will perform if you do business with them. How well do they communicate with you on the phone and via email? Are they polite and clear? Do they return your calls promptly. Do they send you the samples you requested by the date they promised?

In terms of social and environmental responsibility, your business will be judged not only on what you do, but also what your suppliers do. For instance, if a customer complains to you about over-packaged products, you can’t excuse yourself by blaming it on the supplier – you are the business that is selling the product and must take responsibility ultimately.