Establishing good relationship with your Suppliers is important to secure quality and timely production. But that alone is not always enough in the long run. Even the biggest companies find themselves facing situations where their suppliers choose to work on someone else’s order or insist on unworkable terms. So what’s the solution?
If you are a veteran you know the answer - Options. Enough options. And that means there are enough Suppliers in each part of your Supplier pipeline. The beginning of the pipeline has Suppliers you were just introduced to and in the end, Suppliers with whom your relationship is about to end.
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Maintaining the pipeline full requires quite some time and effort. However, too often, because of limited time and also because of insufficient sourcing capabilities, sourcing managers get stuck. The Supplier pipeline does not have enough mature options and sourcing managers are forced to accept price, quality and delivery date they would rather not to.
The pipeline must include Suppliers in three stages of their relationship with your company:
1) Suppliers you were just introduced to and are under evaluation.
2) Qualified Suppliers that have the interest to process your orders.
3) Suppliers that are currently process your orders, or recently processed them successfully.
The number of vendors you need for each stage and for each product depends on your particular circumstances. It is not always possible to tell when a supplier is about to go out of business, or push your orders aside. Therefore you need a pool of approved suppliers ready to accept your orders (I wish it was as simple as it sounds…).
One of the challenges in keeping your pipeline full is constantly finding new suppliers. A second challenge is setting time for new Supplier evaluation, as most sourcing managers can hardly fit into their trip to Asia all their existing suppliers and tasks.
Developing a process that will constantly produce new qualified suppliers is something that every sourcing manager should have, but in reality very few do. The process most suitable for you depends on your particular circumstances. But in any event, one of the most common lead producing methods should work for you.
Spending time qualifying new Suppliers is time well invested. In most cases the suppliers will be happy to come and meet you in your hotel, office or any other meeting place. True, you cannot see their office or factory in this initial meeting, But since you set the time and place, it won’t take much of your time. With a few short questions, you can make a decision whether or not it worth your while to travel and see their office or factory (which is a must if you ever going to work with them). That can save you hours and hours of travel time.
If after that meeting you feel you would like to visit their offices and production facilities, ask them where they are located, keep it on file, and schedule a visit next time you pass by that area.
If after that meeting you feel you would like to visit their offices and production facilities, ask them where they are located, keep it on file, and schedule a visit next time you pass by that area.
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