5 Questions to Ask Potential Suppliers When Choosing One

Choosing a supplier is one of the most important tasks for businesses. It can make or break a business and yet, it’s perhaps the biggest facet of business operations over which the company has very little control after the contract is signed. Finding a new business supplier can be a challenging process, but making the effort to do so will be well worth it in the long run. To help businesses choose the right supplier, here are five critical questions that should be asked before agreeing to terms.

1- What Percent of Your Deliveries Were On Time Last Year?

It’s important to ask about the previous year and not the previous quarter. Logistics during summer or the holidays are likely to be significantly different than those in slower months.

The right percentage will depend on your business. If you tend to know far enough in advance what you’ll need to have delivered and when you can plan for any potential shortages by ordering earlier. If not, you may end up with some irate customers.

2- What is Your Shipping Capacity?

This refers to both the size and amount of free space left in the nearest warehouse, as well as the space left over in shipping containers for overseas warehouses. If they’re near capacity, you may push them over their limit with a particularly large order.

In this instance, you or another company using the same supplier might have to wait until the following shipment date to receive everything, which might be okay but it’s good to know in advance.

3- How are Deliveries Handled?

Some suppliers handle the freight themselves every step of the way, from picking up from the production company to delivering the items to your store.

Others rely on the United States Postal Service or another courier for their deliveries. Still, others will expect you to pick up the freight yourself from their headquarters or another location.

Depending on your needs, any of these solutions (or others not mentioned) might work, although some might not, which is why it’s important to ask.

4- What is Your Returned or Damaged Delivery Policy?

Many suppliers will give you a credit or a refund for damaged goods. However, there may be limits on the amount of money you receive, the number of claims you can make, or other aspects of shipping.

You’ll want to know if individual items are covered (and at what percentage) or if you’ll be given a blanket spillage allowance for each shipment.

5- What Sets You Apart From the Competition?

Almost any answer is acceptable here, whether it’s “better customer service,” “faster shipping times,” “lower prices,” or something else.

Not having an answer is a red flag. Any business in any field should be able to explain why they’re a better value proposition than their competition. If they can’t, they’re probably worse.

By asking these five questions during your next negotiation or request for a proposal, you’ll be more likely to choose a high-quality shipping company that meets all of your needs and can provide you with the information needed to make an informed decision.