How to handle a problem supplier

I don’t know if I have ever worked for a company where there has not been a problem supplier. The supplier who is always shipping late, whose quality is inconsistent, whose communication is slow and erratic. Having a good product with a bad supplier can be an extremely aggravating experience. The question often comes up: how do you handle problem suppliers?

I like to answer this question by telling people that the best way to handle a problem supplier is to avoid them altogether. To do this one needs to evaluate a vendor as thoroughly as possible before deciding whether or not to do business with them. Factory visits and audits are extremely helpful in forming a general first impression of a vendor and their capabilities. However, you have to keep in mind that just because a factory is clean and seems well-organized does not mean it will be the best partner for you. I once worked with a factory that had state of the art machinery, a very clean facility, some very solid workers, but the management was bad. Emails went unanswered for days, problems were not resolved, and the relationship between the factory and the company I was working for was terminated after one year. I have also been to rural factories with rudimentary facilities but the management and communication was so good that problems were resolved quickly and to the satisfaction of all parties. In short, you cannot base your decision solely on your evaluation of a vendor’s facility. More important, perhaps, is your vendors responsiveness and willingness to work together with you.

I have found that one of the best ways to tell if a prospective supplier is going to be a good long-term partner for you is to email them several times – perhaps about samples you want to order – and see how prompt and informative their responses are. What I always tell people is this : If it is frustrating communicating with a supplier when you are just requesting samples, imagine how hard it will be when you get to production. I have generally found that suppliers who are not in the habit of returning emails in a timely manner generally do not make good long-term partners. It is sometimes impossible to solve problems with them, the result being that they deliver to you product which you cannot pass on to your customer. Those suppliers, on the other hand, who make it a priority to answer your questions can prove to be very reliable and much easier to work with when and if problems arise.

If your current supplier is not a good communicator, then you really need to begin to look for a new supplier. There are of course exceptions to this rule, but they are rare.


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