Sourcing from Asian suppliers generally leads to various ways to incentivise the sale which some believe is a regular part of business, but others may say fraud. Greasing palms to garnish a business deal is an age-old affair globally, is it ethical no, but it happens regularly
Why doesn’t this Chinese supplier listen to what I said or follow the instruction sheet?
Do you only evaluate the seller shipping or delivering the goods to your door or do you manage the full supply chain to reduce risk and build brand integrity?
When evaluating suppliers, both services orientated and manufacturing, when you first meet the potential vendor and based on the immediate surrounding your gut forms a first impression.
When starting preliminary discussions with potential new vendors or third party partners, it is advisable to have a confidentiality agreement in place to protect intellectual property or what may be considered information that you do not want competitors or business partners to know. This first step must be considered as a general course of action to protect Confidential Information.
The Supplier Terms and Conditions intend is to ensure all suppliers who manufacture your companies product comply to all business requirements to delivery fit for market product from a price, delivery and quality perspective. These Terms and Conditions are extensive in content, are China centric and serve as an example only.
When starting business with a new supplier think of them as a new employee, they can have a vast amount of experience in the given product category but they will be unfamiliar with your buyer’s process and methodology, they will need to need to go through an induction trial period so both buy and seller develop a solid business understanding.
Sourcing an individual supplier is only part of the sourcing equation, key success comes when you have a strategic supplier matrix that covers all product categories, brand price points and meets business goals and objectives.
Some SME businesses globally rely on a single supplier to supply all their products. Due to their range of categories sold at wholesale and retail, it must be assumed the seller is an agent or trading company. While this allows the buyer to focus on their core competencies, it allows for considerable supply chain risk and possibly margin loss.