Improve your supply chain whenever you can! If you've already developed a supply chain, you can always improve its efficiency and timeliness. Or you can build it the right way from the very beginning. Let it be a significant part of your business, closely aligned with your mission.
In a small business, you have an opportunity larger companies don't always have. Large, long-established supply chains can be wasteful and inefficient, and employees in larger companies don't necessarily understand their supply chains or know how to impro
In a small business, you have an opportunity larger companies don't always have. Large, long-established supply chains can be wasteful and inefficient, and employees in larger companies don't necessarily understand their supply chains or know how to improve them. Also, in 2020 when the world was strike by COVID-19, many small businesses were affected. Nobody ever wants it. So, here are 5 Steps to Setting Up Your Small Business Supply Chain.
5 Steps to Setting Up Your Small Business Supply Chain:
Improve your supply chain whenever you can! If you've already developed a supply chain, you can always improve its efficiency and timeliness. Or you can build it the right way from the very beginning. Let it be a significant part of your business, closely aligned with your mission.
Here's how to plan your supply chain and find new suppliers.
1. Know Your Vision and Your Numbers
Decide on the products you want to sell based on what has sold well before and what your mission is. You must have a sense of what customers want, including feedback and support.
Estimate the demand for each product. Prepare specific numbers to show to potential suppliers. List all the parts, materials, or finished products you need and the amounts you would order from each supplier.
2. Make a Shortlist of Suppliers to Eventually Interview
Whittle down the whole universe of potential suppliers to a shortlist of candidates you will eventually interview. You can find them through these sources:
- Trade Publications
- Trade Associations
- Professional Recommendations
- Local Business Directories
- Trade Shows
- Business Organizations (such as Chambers of Commerce)
3. Rate the Suppliers
A great way to vet suppliers is to interview them using Carter's 10 Cs of Supplier Evaluation. Rate them on a scale in each of the following areas:
- Competency: Their track record of success
- Capacity: The size of orders they can handle
- Commitment: Their commitment to you and standards of quality
- Control: Their control over their processes and supply chain
- Cash: Their financial strength, including liquidity and positive cash flow
- Cost: Their prices compared to similar suppliers' prices
- Consistency: Their ability to produce the same products and quality repeatedly
- Culture: Their core values
- Clean: Their care of people and the environment
- Communication: Their quality and methods of communication
4. Meet the Candidate Suppliers
Try to see first-hand how competent and professional each supplier on your shortlist is. You might not have the resources to fly to other continents, but you can still meet with them through a live video conference. That's often better than just talking on the phone or emailing.
A meeting can also give you a better sense of whether your business cultures are compatible, especially if they're much more extensive than you.
5. Get Quotes and Choose Suppliers
No supplier will rate correctly in every category, so decide what qualities in suppliers are absolute must-haves for specific business objectives and not as important. For example, a supplier might be excellent at clean production and charge a higher price for it.
Ask for written quotes from your favorite suppliers. If you need to, start with a minimum order. You can even use a payment method that carries payment protection on it.
Remember, the lowest price is not always the best if a higher-priced supplier is outstanding in the qualities you most value.
