Someone recently told me about a horrible experience they had with a supplier. They had ordered a large number of items to be put in a large container and shipped across the ocean from China.
However, the supplier discovered that all of the items wouldn’t fit in the container they had agreed upon. Instead of alerting their customer to this problem, they simply indiscriminately removed a large number of products and did not ship them at all without giving any warning of what they had done.
Fast forward a little while and when the container was finally delivered to the customer, they discovered that many badly needed supplies were missing. This meant that they had to disappoint their own customers who had been waiting for them.
This bad situation could have been resolved before it ballooned into a major problem if the supplier had just called, texted, or emailed their client. If there was no way to get another container, the customer could have at least worked with the supplier to prioritize the most important items they needed to get as soon as possible.
Communication Is Key
The need for communication in supply chain management cannot be overstated. If a shipment is delayed, unfulfilled, or otherwise disrupted, it’s up to the supplier to inform the company they are supposed to ship to that there is a problem. This might be painful at first and it could even cost a customer or two because of their disappointment. But over time, this kind of honesty and communication builds credibility and trust.
If a supplier spends more time worrying about getting blamed for delays than they do solving the problems that cause those delays, they’re more likely to keep upsetting customers and making customers wary of doing business with them.
But if a supplier keeps their customers in the loop about their processes, they can work together to come up with a solution when something unexpected comes up. Admitting mistakes is never easy. In fact, it can be quite painful. But there’s no other way to enjoy long-term success.
Monitoring Suppliers’ Performance
You can use inventory tracking software to monitor your relationships with each of your suppliers. If you notice a pattern of late shipments, unfulfilled orders, or short items, you can give those suppliers warnings or find new suppliers, if they don’t change their ways.
Relationships are important when doing business. Your customers need to trust you in order to want to buy your products or services, and you must trust your suppliers in order to continue getting parts and products from them. If there are weak links in your supply chains, you can work to fix them with or without your suppliers’ help, but it’s better if you can work together in a mutually beneficial way.
Open communication facilitates relationship building. Keep the channels of communication open between you and your customers and suppliers so that you can prevent misunderstandings and disappointments from creeping in.
QuickBooks Manufacturing Blog 