Supply Chain Solutions No.14 – Supplier Showrooms don’t tell you the Whole Story

When visiting suppliers for the first time more often than not, you are directed to the showroom which doubles as a meeting room. The initial instinct is always to look at the product on show to get a gauge of the markets, brands and types of product that the vendor is currently manufacturing.

The challenge always lies in that the product may not be current; it might have come from business with a customer three years ago, or it might have been subcontracted. The product you see may not match the current manufacturing capability of the vendor, to this end, you should never gauge the ability of the vendor on their showroom.

I tend to have a knack for picking up a defective product, not because that is what I am looking for it is just what I select from the samples in front of me. Likewise, the product in the sample room will not be indicative of the quality of the factory for the same reason as above (product might have come from business with a customer three years ago, or it might have been subcontracted); you just don’t know where and when it was manufactured. The majority of the time I get statements from the vendor like it was made in the sample room or not from production, but every so often I get vague looks as none of the vendor’s team can identify the quality defect. This does let you know early in the piece that maybe you are better off continuing your search elsewhere.

It is suggested that when going to new vendors you do your introductions and the next step is to visit the vendor’s facilities, sample development room, raw materials warehouse, manufacturing, finished goods warehouse, quality control centre and laboratory. Once you have visited all facilities, you will know their current capability based on the product seen, machinery, process, and overall setup.

I like to look in the raw materials warehouse, there will be raw materials for current production and wastage from the previous production, this will give you further insight into the vendor’s capability. Additionally, look for subassemblies, partially made product to understand how much work is subcontract, this can also be calculated by looking at the manufacturing capability versus declared monthly output, ask yourself do the two balance?

Once you have reviewed the facilities and understand the vendor’s capability, what you see in the sample room will make much more sense as well as additional business conversations thereafter.

Bottom line, the sample room is dressed to sell and doesn’t necessarily equal the reality of the vendor’s capability today.

ID Global Concepts are experts in supply chain management. We add value to your supply chain through consultancy or management contract to ensure the business has the best practice systems that are the right fit for your business, customer and meet your value expectations.

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