Good business practice is essential if you want to build a well-regarded company within any sector. Within engineering & manufacturing, which depends on the production of physical components, the implications of quality and reliability extend much further, meaning that most manufacturing buyers are selective about who they place their business with - and rightly so. However, as much as a 'good' supplier is a real thing, so too is a 'good' customer and you could be hurting your supply chain if you fall short of the mark.
The UK has recently experienced a surge in reshoring, largely due to the combination of Brexit and the COVID-19 pandemic, which have both had a substantial impact on the viability of international supply chains. This means that UK subcontract engineering suppliers are now much busier as a rule of thumb, and can afford to be more selective about who they dedicate their capacity to. Buyers who do not take steps to be a 'good' customer can no longer expect suppliers to rush to their aid when they're in a jam; moreover, they may also find that their regular suppliers begin to prioritise orders from other clients.
If you want to instill loyalty from your suppliers, then here are a few ways to ensure that you're a great buyer to work for:
Make Yourself Available:
Communication is also about a lot more than just answering questions - it's also about building a rapport.
Just as you would expect open communication from your suppliers, it's important that this is reciprocated. Making yourself available to answer questions from your suppliers is crucial, otherwise you may find that the parts you've ordered are not fit for purpose, or there may be unnecessary delays while your supplier waits for an answer. Not being able to get hold of someone is a frustrating experience for anyone, but for suppliers who are working hard to meet your deadlines, it can be especially difficult to come up against radio silence.
Communication is also about a lot more than just answering questions. It's also about building a rapport with your suppliers that helps them to understand you as a person. If you need a supplier to go out of their way to help you, then they'll be much more inclined to do so if they know you on a somewhat personal level. If they have a better relationship with other customers, then you may find that your order simply gets added to the queue.
READ: Common Mistakes Buyers Make When Sourcing Subcontract Suppliers
Pay On Time:
Late payments may make some suppliers hesitant to build an ongoing partnership with a buyer.
The importance of paying on time really cannot be understated. Ultimately, making money is the sole aim of any business and your suppliers will have their own bills to pay. Suppliers will therefore rarely want to work with buyers who have payment terms that are longer than thirty days. Larger OEMs sometimes operate with payment terms of up to ninety days - although the initial kudos of working with a household name may be enough to lure some suppliers into working with bigger companies, these are rarely sustainable conditions for a subcontract engineering business to adhere to on a long-term basis.
Late payments may understandably make some suppliers hesitant to build an ongoing partnership with a buyer. The old adage 'one bitten twice shy' is never truer than in business, where the livelihoods of employees and owners alike are on the line. If you do not pay your suppliers within the agreed time frame, then you cannot be surprised if they don't want to continue the relationship, which could come back to bite you at a later date.
READ: The Implications of Late Payments For SMEs
Be Clear About Your Expectations:
If your supplier isn't kept in the loop, then you cannot be surprised if the results fall short.
If your supplier isn't kept in the loop about what you expect when it comes to a project or the business relationship at large, then you cannot be surprised if the results fall short. When it comes to outsourcing a new project, then good quality technical drawings will pay dividends in helping your supplier to understand the requirement; if this is not possible, then make sure that your supplier has all of the information they need regarding dimensions, accepted tolerances, materials, finishes and lead times.
It may also help to highlight what is most important to you - whether you require exceptional quality, or a fast turnaround. By emphasising the make-or-breaks of the project and the business relationship, you can ensure that everyone is singing from the same hymn sheet, so to speak, meaning that there will be no unpleasant surprises for either party.
READ: How To Get a Faster Response To Your Subcontract Engineering Projects
Under current market conditions, buyers need to be prepared to be a little bit flexible when it comes to their orders.
Setbacks are sometimes inevitable, but there is a lot to be said about how a supplier handles any unforeseen circumstances. If they are upfront and honest about the situation and do everything they can to achieve a favourable outcome, then it's best to be as understanding as possible if you want to maintain a good working relationship. Under current market conditions, including the worldwide materials shortage, buyers need to be prepared to be a little bit flexible when it comes to their orders - suppliers may not be able to guarantee prices for long periods of time, or there may be unexpected delays in sourcing the correct material grade for the job.
Of course, if your supplier continually ships late or there are ongoing quality issues, then you are more than within your rights to express your dissatisfaction. However, when it comes to one-off or infrequent occurrences that are outside the supplier's control, then it pays to have a little understanding given the wider issues currently affecting the industry.
READ: How To Manage Increasing Material Costs
There's nothing to say that all talk needs to be strictly business.
Ultimately, the key to any great business relationship - whether you're a buyer or a supplier - is to not be afraid to let the human element come into play. There's nothing to say that all talk needs to be strictly business and suppliers will appreciate a bit of amiable chit-chat about holidays, sports, or weekend plans. It's these sorts of conversations that really help to boost the rapport you have with your suppliers and make them look forward to speaking with you. It also shows them that you're approachable, which goes a long way towards resolving any issues as and when they arise.
READ: Buyer-Supplier Relationships - Why Honesty is the Best Policy
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