Whether you own an established brand and are looking to expand it by adding handbags to your inventory or you’re newly launching your company, finding the right supplier is essential to your success. Identifying a suitable supplier requires serious consideration on multiple fronts to help aid you in landing a contract that aligns with your business's bottom line.
Listed below are a few points we consider when seeking our supplier (manufacture):
- Evaluate our supplier relationships – if you currently work with or have worked with a supplier in the past and found success with their products, it is always a good idea to view their inventory to identify if they currently provide the products you are looking for.
- Trade publications – utilizing online supplier bidding websites such as biddingo.com reverses the “seeking supplier” situation. Create an account, list your required criteria, and the suppliers will submit bids TO YOU! Although this method alleviates the time you’ll need to dedicate to finding a supplier, it will require you to do proper due diligence on any company that submits a bid to verify their legitimacy and professionalism.
- Competitors – researching your competitor's supplier relationships may provide insight into which manufacturers would also be a good fit for your business. It is essential to assess, however, if this possible working relationship would be ethical and low-risk before going entering a contract agreement.
- Seek industry groups – these groups (many of which are not-for-profit) are great resources that contain extensive databases with detailed information on hundreds of suppliers in any given industry.
- Internet research – we’re in the golden age of technology. Taking advantage of the various online resources provided to all of us is a time-effective way to gather information on suppliers. Although the internet is riddled with misinformation, by conducting research via trusted verified websites, you can find real reviews of suppliers that will provide unique insight that the suppliers themselves may not have on their own accord.
You’ve created your criteria and narrowed your search to a selected list of possible suppliers. Now it’s time to put your power-suit on and get down to business. Define the following details and get ready to submit your RFP’s (Request for Proposal) and/or RFQ’s (Request for Quotation):
- Request detailed product description lists for specific items of interest
- Inquire about item quantity minimums and maximums
- Delivery dates
- Quality standard/assurance processes and procedures
A few key points to keep in mind are that offering more massive deposits may allow for more significant discounts. During this process, it is vital to selling your business to the supplier by demonstrating your value to them as a client while also requesting detailed reports on reasons why you should choose them. If you are currently working with multiple suppliers but locate one that may satisfy all your needs, pitching the idea of working with them exclusively may also help land you a better bid. Tailoring your pitch to each supplier will improve your response rates. If you’re looking to add wholesale handbags to your wholesale jewelry site, mention that. If you’re just beginning with a wholesale boutique, be sure to include what marketing methods and measures of success, you’ll be implementing to ensure profit feasibility. Always remember the first offer is the worst, and you can usually negotiate the price down by employing these points. Once the bids come rolling in take the time to evaluate which partnership will best suit your bottom line before accepting any offers.
Creating the Contract
Once you have your ducks in a row and your supplier in tow, it’s time to get that contract ready to go! Reviewing the terms and conditions thoroughly before signing is imperative to ensuring your business isn’t placed in a comprising position. Seeking an attorney in this stage can help to safeguard you from any potentially harmful bylaws or amendments, the supplier may attempt to slip in. Including a clause that allows you to complete a set number of transactions as an introductory period with the option to terminate the contract if the supplier does not keep up their end of the bargain is a great way to safeguard your business from blowing big money if you should find that your partnership isn’t profitable. Once an agreement is reached and a contract is signed, you are officially one step closer to setting up shop. Some suppliers may utilize a purchase order as a form of contract. Purchase orders indicate activating your procurement system and should show its time to get your accounts payable process ready to take care of that initial invoice.
Evaluating Supplier Performance
Ensure you have a direct point of contact for your supplier. Take the first few transactions to tabulate whether the company is completing their end of the bargain satisfactorily. By monitoring this closely (especially during the first few months), you can quickly evaluate if this is a working relationship worth continuing or if you should cut ties early on. Additionally, having this information on hand will help you to stay competitive during future contract negotiations and help you to get the best prices possible.
Taking these steps prior to delving into the competitive world of wholesaling handbags will strategically set your business on the path to success. Remember, finding the perfect supplier is absolutely dire to satisfying your customer's needs and placing you in a position of profitability.