What are the most effective methods for finding and evaluating potential suppliers? (2024)

For me, the most effective method is utilizing the network that I have built up over the last 15 years. This has been done through tradeshow visits, factory visits throughout Asia (mainly China), and industry networks. The next best way I have found is to use online supplier directories. Utilize these directories and platforms that specialize in connecting buyers with suppliers, like Alibaba, Taobao, and Global Sources. These platforms often provide detailed supplier profiles and reviews, but you do need to be careful here as there is a certain what to navigate and search on there.

Understanding internal customer , their requirement, purpose why the activity needs to be done, understand procurement role in supporting business requirement and then start shortlisting partner/vendor.First search the partner/vendor from the current pool, existing vendoe database(maybe we find one)Secondly, talk to vendors who could be in similar business (maybe they have developed capabilities)Third, talk to your old procurement colleagues from diff orginazations, for ref.If all options are exhausted, talk to your business person who has given requirement, maybe the requirement was generated by him due to some conf they attended, or some new idea they saw from some vendor, my view these are best options to find ur potential partner

Let me explain by an example.Imagine your company produces and sells ballpoint pens with plastic bodies. Each pen has:— a plastic body— an ink feed— a plastic capNow you need to define, for example, for the body:— if you need a supplier of a plastic body; or— if you need a supplier of plastic granules & you will mould the body in-house.— Do you want a factory that can buy all the components and assemble them?In this, two departments will be of help:(1). Technical(2). Quality Then define the commercial side:— budget?—payment terms?—Supplier location?— Preferred manufacturing process?— Safety, health and environmental aspects of the new supplier.The more detailed your approach now, the easier it will be later.

It's very interesting when we talk about looking for suppliers who can follow the regulations of the company where we work. My experience as a purchasing person and also a goods searcher, really agrees with the opinion above. then don't forget, at this time technology has developed very rapidly, it cannot be denied that we get supplier references from social media and Google, therefore a good supplier should have an official website which can be our first benchmark as goods seekers, then Additionally, we need to survey the supplier's location.

Its similar like as PDCA cycle. Plan-- Understanding Project requirement / Review Specification/Quality Assurance & Control Plan) + Project Cost requirement /Budget + Delivery requirement . Do- Search supplier + Collect supplier Information / credentials including financial details on primary basis . Check- Verify it. Do shop floor assessment as per requirement + Market feedback + Track record to check delivery commitments + Apply experience judgement skill to meet requirement .Supplier overall approach is very crucial factor in it. Good facility means supplier is OK approach is partial correct. Act- Approve it / Suggest improvement points / development points . Cost +Quality + delivery requirement parameters are most critical

In conducting market research for supplier evaluation, we start by identifying potential suppliers within the industry. We analyze their product quality, pricing structures, and track records. Comparing these aspects against our specific requirements and industry standards helps shortlist the most suitable candidates. Additionally, we assess supplier reliability, communication responsiveness, and ethical practices. Feedback from other businesses and customer reviews provide valuable insights. Understanding market trends, demand fluctuations, and emerging technologies guides us in predicting supplier sustainability and adaptability.

Top-down approach.— If your goods need a specific type of Raw Material and that raw material is available in a specific region. So it makes sense to look for suppliers in that region.— If your product requires labour-intensive jobs, then go for a low-cost country where labour is cheap.Then you need to further dig for Potential suppliers. The sourcing companies, trade bodies etc. can help you with this.The next step would be to remove the non-qualifying from your list. You can issue an RFP to the potential supplier to figure out if they are fitting.

Prior to conducting market research, I look at the details and specification of the requirements.Typically, robust and complete market research involves both quantitative and qualitative methods, as both offer valuable perspectives and can be combined to generate actionable insights.

One thing I found helpful would be to check each suppliers customer list . This would give you an idea of the biz scope and quality level.

In my experience, after compiling a long list of potential suppliers, I contacted them and negotiated for this project. We then reviewed the technical details of the project with the engineering department, where we developed it according to our preferences, including volume, price, delivery time and contract terms. After the design, I held meetings with the suppliers to assess their capabilities, experience and suitability to carry out the project and asked them to provide the relevant documentation.

Please keep in mind the following advices in order to use the RFI phase effectively:Be clear about your needs and requirements in the RFI document.Ask open-ended questions that allow suppliers to provide detailed information about their capabilities and experience.Set a deadline for suppliers to respond to the RFI.Review the RFI responses carefully and score them based on your criteria.Use the RFI responses to create a shortlist of qualified suppliers for the RFP phase.

From me is no need to rush into an RFQ. Do the RFI first and gather all the information you need from Supplier. Dig deeper and deeper. And align them with the project. Such as what is their main product/services? Is it import of manufactured locally? Is it any plan for expansion? Etc. You'll be surprized when you dig deeper. You might find out that they even have their own Special Transportation Truck!

Request for information (RFI) should come between the market research and RFP phases.The RFI phase in the purchasing process is a stage where organizations send out a request for information to a long list of potential suppliers.The goal of the RFI is to gather basic information to narrow down the list of potential suppliers to a smaller group of qualified suppliers.The basic information that suppliers typically provide in response to an RFI includes:Company name and addressContact informationYears in businessNumber of employeesAnnual turnoverProduct or service offeringsExperience with similar projectsCustomer references

Beyond evaluating proposals, references, etc, I would never proceed to bulk production with a supplier without a physical sample. Reviewing the work firsthand is well worth the time and money investment. I have seen too many quotes that sound great, only to find the supplier could not deliver a quality prototype. This will show you what they're capable of, and what their workflow is like. Do they deliver on time? Are the communicative? Have they followed your instructions? Beyond price, these things matter a lot.

Finding and evaluating potential suppliers is crucial for business success. Effective methods for this include industry associations, online directories, networking, search engines, and social media. When evaluating suppliers, focus on quality, reliability, price, financial stability, capacity, location, certifications, communication, ethics, contracts, facility visits, performance metrics, and risk assessment. These steps help ensure you select the right suppliers and build strong, reliable partnerships to support your business's growth and success .

Contract negotiations can be undeniably stressful. The high-pressure, high-stakes nature of B2B negotiations can all too easily cause your sales team to give in to dishonest practices designed to land a sale, rather than cultivate a successful long-term business relationship. A deal room experience is a key step in proving that your team doesn’t give in to that temptation — even when dealing with dishonest negotiators.Regardless of whether negotiations are occurring in a face-to-face setting or digitally, this approach can serve as a powerful resource that helps your team lay the foundation for relationships that last. Google, "How The ‘Deal Room’ Experience Can Make (Or Break) Contract Negotiations" to read more!

Effectively managing and monitoring suppliers begins by establishing clear expectations and performance metrics. Regular communication and status updates ensure alignment with our requirements. Implementing a robust supplier management system allows for centralized monitoring of their performance, quality, and adherence to agreed terms. Addressing any issues promptly and conducting periodic reviews foster a healthy supplier relationship. Encouraging open feedback and conducting audits verify compliance with ethical, environmental, and contractual standards. Diversifying suppliers and maintaining a contingency plan mitigates risks.

Apart from monitoring during contract period, I believe there must be post project evaluation and annual evaluation to highlight the achievements / weakness of supplier that can be helpful for future references also.

The exchange of information between a buyer and supplier is a reciprocal process. The ultimate aim for suppliers is to able to consolidate their documents and processes and deliver it efficiently. Concurrently, buyers wants to monitor the live status of their orders and track all processes via a single view.Incorporate seamless automation helps to bridge the gap, thereby eliminating the need for unnecessary manual monitoring and auditing processes. This proactive approach not only prevents any potential disputes but also removes redundant procedures.With proactive automation ensures that Key Performance Indicators (KPIs) and overall performance are tracked from end to end providing enhanced visibility and ensures efficiency in operations.

Ensure you measure your joint desired outcomes and view them as a vital part of the partnership.Not only tracking what your supplier delivers, but also the business value you jointly create with your supplier. You and your partner both benefit from the success of your individual businesses.

Seek ways to build trust with suppliers. Over the past two decades, many studies have tied trusting supplier relations to a plethora of customer-related benefits. Look for cooperative solutions that maximize value. Creating proverbial ‘win-win’ solutions with suppliers will turn adversarial win-lose relationships into solutions that benefit both parties. Don’t use handshake deals. In any relationship, both parties have a set of rights, roles and responsibilities. These should be clearly defined to set clear expectations. Establish trust, foster collaboration and create more fair and balanced formal relational contracts with your most strategic suppliers.

To add to my last point, supplier audits and QC inspections are massive! Consider conducting supplier audits to assess their capabilities, QC processes, and adherence to their industry standards. Look for suppliers with relevant certs & accreditations that demonstrate their commitment to quality and compliance.

Before considering what suppliers to work with its important for any department or business to have a true sense of itself first. Finding any external partner becomes a lot more rewarding (and a lot easier) if you have a clear vision, set of values and working practises already established. Any supplier relationship which has a fundamental culture clash or a significant difference in what each party is trying to achieve causes additional headaches and challenges. These can be avoided.

To attract suppliers requires that we understand our business culture and behaviours first - that is understand our attractiveness to the suppliers, and also identify those behaviours that make us unattractive.This requires honest assessment, and action taken on what we discover that’s unacceptable or unattractive.Without that all other actions may result in suppliers walking away (before contract or even after contract) or performing badly because they’re having to deal with behaviours they weren’t expecting.