Common Supplier Issues And How to Avoid Them

A day in the supplies department is never slow. The tasks involved in supply chain management can be full of challenges. This is true regardless of how big or small your business may be. Supplier issues do happen from time to time and even multi-million companies are not exempted from the possibility of such an occurrence.

In fact, in 2017 the BMW company suffered a major setback on their production 3-series Sedan due to issues with steering gears supply. This goes to say that supplier issues are real and can be as daunting as they are. Other examples of supplier issues, along with suggestions on how to avoid them are detailed below.

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Supplier Management

Identifying the best supplier and determining vendor performance are just two of the many issues that make supplier management so challenging. This is when the need to use a nonconformance management software becomes increasingly important. It greatly helps ease the burden associated with supplier management.

Using this kind of software will help those who are in-charge of supply chain management to easily track any defects pertaining to suppliers and customers. Besides, this kind of software also functions with real-time email alerts to inform the staff of any rejection tags that may arise from out-of-tolerance measurements.

Unexpected Delays

If the process of procuring materials, products and other supplies seems easy, the delivery time is the most difficult part. This is very likely to happen especially when the supplies have to be sourced from overseas. You have to deal with different time zones which make shipping time far different from your time zone as well.

To avoid issues with unexpected delays, see to it that you always have buffer stocks. Even if the delivery of supplies will be delayed for a week or so, an efficient warehouse management system will help ensure that you will always have supplies to use until the new batches arrive.

Safety And Quality Maintenance

The safety and quality of supplies is another concern that people in the supply chain management face every now and then. This is common if the supplies are obtained from other countries that have different quality and regulatory standards. This increases the likelihood of supply recalls which could seriously impact the company’s reputation. To avoid this incident from happening, supply chain managers should ensure that their suppliers and the products obtained are able to meet the safety and quality of standards in their own country where they will be manufacturing their products.

Budgetary Problems

Obtaining supplies that cost way beyond what your company’s budget only allows is also another issue that people in the supply management department encounter. Unfortunately, this issue can also lead to several other issues. First, when the supplies ordered cost more than the intended budget, the company’s bottom line will be affected.

Second, if the order department cannot secure a budget from the finance team to pay for the extra cost, the company’s reputation will be at stake. Not to mention the damage it could cause in supplier-customer relationships. To avoid this from happening, your budget or finance department should coordinate closely with the team in charge of ordering supplies.

Failure To Establish Internal Policies

This issue can be common among fledgling businesses in which they haven’t created a proven and tested system in their supply management system. Although flexibility is indeed a good thing, failure to set up internal policies for everyone to follow will only increase the likelihood that problems in the supply management system will happen over and over again.

To avoid such a thing from haunting your business, you have to set a clear policy that will be adhered to by everyone in the supply management department. Once these policies are set in place, things will no doubt start to move smoothly and should issues arise, your team will already be better able to handle it using the guidelines set.

No Vendor Policy

Many companies, especially those who are still in its infancy are operating at the mercy of their vendors’ customer service. So, if their vendor or supplier decides to increase the price of the raw products or supplies that they usually order, they have no choice but to pay for it.

When deliveries are delayed, they wait and charge no extra fee for the vendor. But, you can avoid this thing from happening if you only come up with a good vendors policy and communicate this to your suppliers or vendors. Give your vendors a copy of a document detailing these policies so that they will be aware of what they will be agreeing to whenever they conduct business with your company.

These are just a few of the many supplier issues that a company is bound to experience especially if they are still new in the industry. All these issues may not be resolved overnight but what is more important is to take action and not wait for these issues to get out of hand.

If you are interested in even more business-related articles and information from us here at Bit Rebels, then we have a lot to choose from.

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