- For new businesses, getting suppliers on board is simply a matter of reducing their exposure to risk.
- The risk appetite for suppliers depends on four things:
- The size of the order in dollar terms
- The past relationship with the buyer
- The payment terms for the order (upfront payment equals lower risk)
- The size, reputation, and seriousness of the buyer
- The easiest way to do this is by offering to pay upfront. Suppliers won’t care about the size or age of your business as long as they’re getting paid.
- Show your legitimacy by knowing what you want. Being clueless is a clear sign of an amateur business owner.
- Some operate a customer-facing website where you can order limited quantities (as low as 1 item) at retail prices. To get wholesale rates, you have to create a “wholesale” account. This often requires submitting your tax information.
How to Find and Work with Suppliers
- Suppliers can be an important sources of information, helping you evaluate the potential of new products, track competitors’ actions and identify promising opportunities. Suppliers can turn into partners, helping you cut costs, improve product designs and even fund new marketing efforts. If you don’t make selecting good suppliers and suppliers a part of your growth plan, you’re likely to regret it.
- Suppliers can be divided into four general categories. They are:
- Manufacturers: Prices from these sources are usually lowest, unless the retailer’s location makes shipping freight expensive.
- Distributors: They can supply retailers with small orders from a variety of manufacturers. A lower freight bill and quick delivery time from a nearby distributor often compensate for the higher per-item cost.
- Independent Craftspeople: Exclusive distribution of unique creations is frequently offered by independent craftspeople, who sell through reps or at trade shows.
- Import Sources: Many retailers buy foreign goods from a domestic importer, who operates much like a domestic wholesaler.
- Reliability is probably the key factor to look for in suppliers. Good suppliers will ship the right number of items, as promised, on time so that they arrive in good shape.
- Stability is another key indicator. You’ll want to sign up with vendors who have been in business a long time and have done so without changing businesses every few years.
- Don’t forget location. Merchandise ordered from a distant supplier can take a long time to get to you and generate added freight charges quickly.
- You’ll want suppliers who can offer the latest, most advanced products and services.
(Sources: https://www.entrepreneur.com/article/66028 , https://www.entrepreneur.com/article/225774)
Finding Small Business Wholesale Suppliers: The Definitive Guide (https://www.nationalbusinesscapital.com/small-business-wholesale-suppliers/)
Setting up Accounts with Suppliers (https://www.worldwidebrands.com/free-ebooks/Starting-Your-Internet-Business-Right/chapter-13-Setting-up-Accounts-with-Suppliers.asp)