Building a good business model is a big thing. The next big thing is to watch it grow. If you are in the trade business, there’s a constant fight to keep up with the growing demand-supply equation, without any compromise on quality. As your business expands in different markets, you would need to collaborate with suppliers in various parts of the world. Yes, the opportunities of having a global business footprint are immense. But there are challenges as well. Once your product crosses the domestic borders, it is encountered with legal checks, taxes, restrictions, and government regulations. And this is why, to find global suppliers, you need to be well-informed. Let’s look at some important considerations while selecting global suppliers.
Invest Time & Thought in Selection
The relationship you will be building with your suppliers is not merely transactional. At the core, this business collaboration will determine how far you can travel with your product. Even the slightest lack of enthusiasm, sincerity towards quality compliances, regulations, and delivery will only reflect on your growth. Further, not having reliable suppliers in the value chain will impact other departments as well. You have to be cautious and choose wisely. In modern times when the world is getting smaller every minute, various platforms are offering digital solutions for importers and trade data intelligence for suppliers. This selection process can get cumbersome if you are on your own.
Any hindrances in this part of the business will lead to a disconnect between your expectations and delivery. Down the road, ensuring that a supplier can actually do what they claim can save ample time and headaches down the road.
Additionally, you can expand your partnerships with global suppliers to leverage other capabilities and expertise they may have.
Conduct On-Site Visits
No credible establishment wants to be projected as an irresponsible business. And to get an insight into the full picture of your potential suppliers, leave no opportunity to know them better. On-site visits can be a great way to understand the internal working conditions, capabilities, and culture. What are the working conditions like? Are children employed as labour? How is the work structure? Are employees satisfied with the benefits and compensation or is there a sign of exploitation of human resources? These are some important questions that an on-site audit will answer. This can also help you look for the red flags and potential risks in the collaboration, if any. You can also take references from people already with a strong network in the supply chain and with a great experience. Overlooking the grey areas is not an option if you are building a business with the goal to provide value to your clients. So take all the help you can.
How safe is a lower price point?
Manufacturing has never been isolated from safety and security concerns. But with globalization and a booming international trade landscape, these concerns have assumed the center stage. Quite often, global suppliers are willing to offer a low price and this is where you need to scan through the hidden costs. What safety standards are being compromised? What restrictions are not being complied with? How safe is the product? When product safety is clearly defined on a global scale, suppliers are more eligible to deliver worldwide.
Are the Suppliers socially responsible?
Your brand carries a reputation and it will take only one wrong step to tarnish the brand image. Since the supplier you choose will be linked to your company, you must take note of the fact that they are contractually bound to be socially responsible. Any breach should be considered a violation of performance codes.
How will you track Third Party Labour Contractors?
This is a tough one. When your supplier decides to hire resources through a third-party labour contractor, you must specifically state in the contract a process for vetting the organization. There must be some criteria for legal recourse if there are any unfair or informal hiring practices.
Find Global Suppliers whom you can trust
Generally speaking, this is not the first time that these factors are being discussed while selecting global suppliers. It’s tricky how obvious they are yet, there is always a ground for loopholes. While building a future for your business, look at your suppliers as a long-term partnership that provides value. It should be a win-win game. Fines, fees, and bad media can hurt your business more than you can imagine. Why take chances when there are endless opportunities to choose wisely?