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Strategies for the supplier search
Are you having problems finding suitable suppliers or retaining existing ones? Many companies find themselves in the difficult situation of having to locate suppliers, which can be tedious and time-consuming. In the following article, we would like to explain what options small and medium-sized companies have for organizing their supplier search and to what extent unconventional solutions can be appealing.
The most important information at a glance:
If you start actively looking for suppliers, fundamental preparations such as an inventory analysis should already have been completed. This is because the products or individual parts of the products that are to be produced should already be precisely defined. If this is the case, then it is easier to find a suitable supplier who can manufacture the product exactly as the company wishes. Ideally, you will already have technical sketches that suppliers can use to see whether their production facilities are capable of manufacturing such a product. It is important to note that, depending on the individual situation, different approaches can lead to the desired result.
Many companies use traditional tenders to cover their needs. The big advantage here is that, depending on the size of the email portfolio, a fairly large pool of suppliers can be approached. Tenders can also be published in industry magazines, online registers or forums. The disadvantage here would be that such an invitation to tender can probably only address suppliers that are already very well known and established; new ones cannot be found so easily. The large suppliers do not automatically offer the best quality and the best price-performance ratio. Language barriers can also make communication difficult, especially when it comes to the details of the order and the products.
Business directories are probably one of the best-known tools for searching for and researching suppliers. A distinction can be made between general business directories and industry-specific company directories. Various selection criteria such as geography or the size of the supplier can also be taken into consideration. Although such company entries are relatively extensive, niche suppliers cannot always be found easily, which means that special products may not be found. Furthermore, industry entries are usually only useful in Europe, which means that important markets such as America or China are often left out.
As we have already written in detail in our article on Chinese online trading platforms, there are various providers for goods produced in China on the internet. These online markets differ from the yellow pages in that they are usually tailored to the B2C market. Companies have a particularly good chance of finding a supplier if they only need standard parts whose production costs are minimal. This means that costs can be saved, but companies have to take care of the logistics themselves and small companies in particular usually have no one on site who can check the quality. As a result, there is often no room for individual wishes in production and it is often risky to work with these platforms, as there is usually no independent person on site to monitor production.
Very few companies currently use AI solutions, as there is still a lack of trust due to a lack of transparency. However, it could be worth investing in such software in the long term. In principle, it can be said that such a solution can theoretically cover all areas of the supplier search, even if it is likely to be used primarily for operational processes in the future. However, there could also be counter-arguments with regard to the supplier search. On the one hand, pricing structures are usually too cost-intensive to manage a relatively infrequent supplier search. Secondly, such solutions can only identify a small part of the supplier pool.
