If a purchasing department or purchasing agent is considering switching from your company to another supplier, are you ready with a set of questions that could reveal why such a switch is a bad idea?
Here are some specific questions that you should consider asking:
• What is the cost of setting up a new vendor in your computer system?
• What does it cost to inventory a new item and how do you work through the conversion of inventory?
• How do you communicate to the others involved when you change a supplier?
• How does finance or credit handle billing a new vendor?
• What are the operational standards you have to meet if you’re going to switch suppliers?
• What is the cost to the company if the switch is not successful?
• What is the order pattern and necessary lead time to place an order with the new vendor?
• What are the implications from a quality control perspective of changing suppliers?
• Has the product being looked at been “QC” tested to ensure integrity? If not, what are the costs in time and money to conduct these “QC” tests?
As you can see, being ready with specific questions like these will clarify that switching could be a bumpy road of frustration instead of a smooth path to savings. When you are working closely with purchasing departments and/or purchasing agents, show up prepared.
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