Choosing the best raw material suppliers

How do you choose a raw materials supplier and ensure you won't have problems? A poorly selected supplier can be crucial to your company's overall success. While this question isn't 100% fool proof there are a few things you need to consider in your search.

Cost
Cost is the first point we always think of when we compare companies. So we'll start there. Cost isn't always the most important aspect when selecting a supplier. When you begin comparing companies get hard copy quotations and verify that those costs are not variable. Find out about contract rates and how often those contracts are renewable.Look for any hidden fees in transport or services. All of the costs need to be accounted for upfront to make a viable comparison.

Service
This can sometimes be a deal breaker. You want to make sure that the raw material supplier you are dealing with can provide you with the service you hope your company provides its own customers if not better. Ask yourself a few questions? How knowledgeable is the staff you work with? Will you have your own personal representative that handles your needs or are you required to call into a generalized help bank? How committed are they to the industry and how ethical are their practices? Most important, how quickly are they able to answer your questions or resolve issues? You want a company that is committed to you like you are committed to your customers. You need to make sure you have a company that is willing to solve problems quickly and efficiently. Make sure you aren't going to get the run around if a crisis comes up. What kind of support do they offer you after hours? Has anyone recommended them to you that you trust? Finally, you also need to look at the systems they have in place for ordering.Can you place orders online, or do they have to come by phone or mail?

Quality
When comparing companies you also need to be cautious when assuming that company A's product is the exact same as company B's product. Make sure you check the specifics of the quality. Even something as simple as Apple Juice has variation in quality of product. If you are going to compare companies equitably you need to make sure the product you are comparing is the same. Also, you need to make sure the quality they offer is acceptable for the product you create. You don't want to run into a situation where a sub-standard product becomes the reason for a serious production issue.

Inventories
This may seem minor in nature, but if and when the time comes when you suddenly need more than what you ordered it can seem colossal. Check with each of your raw material suppliers and verify how much they keep on hand in their warehouses. Make sure you verify the proper protocol for obtaining extras if the need ever arises. Is the process difficult? Make sure that you won't run into issues of a lesser quality product being substituted in times of shortage without authorization. Finally, you need to make sure that the company you choose can handle the regular quantities your own company will require. Don't shortchange the amounts. It's important that the raw material supplier knows in advance what they can expect to drain from their own inventories.

Transport
Last but certainly not the least in importance is transportation. This may seem silly, but you need to make sure you understand how your materials are going to get to you. Are there additional fees for certain quantities? What happens in an emergency or shortage and you need more? Can they get it to you in time? What type of charges are involved in RUSH orders? Can you even RUSH an order if need be?