Running an eCommerce store is a highly competitive business. The failure rate in the industry hovers around the 80% mark. Surviving is not easy, and managing your suppliers is one of the keys to long-term success.
Unfortunately, managing eCommerce suppliers is not quite as plug-and-play as ordering something from Amazon Prime. In this guide, we’ll take you through the key steps to ensuring you have a successful relationship with your chosen supplier(s).
Find the Cheapest Supplier, But be Smart
The more automated and click-to-buy solutions are usually the most expensive. This is because they can charge a premium to make things easy for you. But of course, this eats into your profit margins.
The alternative is a DIY solution; i.e. finding your own suppliers and wholesalers, and managing the entire process yourself. The cheapest supplier will probably be in China. There’s a reason why most eCommerce companies use Chinese dropshipping companies: cost.
There are downsides, however. Communication is one of them. You need to ensure you find a supplier that has employees that are English speakers. It sounds like a no-brainer, but you’d be surprised how difficult this can be.
And you also need to think about a lot of issues that you would otherwise not have to do. For example, payment isn’t always as easy as a bank transfer or whipping out your company credit card. Paying and transacting with Chinese suppliers is a science unto itself, and you need to be aware of the administrative costs this will add.
Do not leave anything to chance, and don’t assume the process will be automated or go without a hitch. Test first. Product samples, test orders, the works. You don’t want to sign a contract with a supplier only to find that they will not meet your expectations.
Invest in the Relationship
Suppliers are more than your standard business relationship. They make your business tick; without them, you’re just a website. It’s a smart move to treat your suppliers like humans; after all, there’s always a person behind that email, ticket response, and order.
Investing in the relationship will help the order and delivery processes. If there’s an issue, you will be able to talk to a person, rather than an automated reply from a customer service portal. It makes the workflow for everyone that much easier.
Having a good relationship is just good for business. You may find opportunities you would otherwise miss, like ‘off the menu’ items, samples of new products, and the heads-up on upcoming releases.
Do Not Assume Dropshipping is a Hands-off Solution
Dropshipping can be a great addition to your eCommerce arsenal. You don’t have to handle products or shipping, the process can be almost completely automated, and profit margins can be very healthy indeed.
However, most people do not understand how dropshipping works. And they’re often advertised as super easy hands-off solutions, which just isn’t the case. There are many pros and cons. You have to make sure that your dropshipping supplier will actually deliver on its promises.
Check the product before it’s sent out. Samples are essential. And if they are shipping from abroad, ensure that the delivery process is not slow. People are not patient these days, especially with services like Amazon Prime.
Pay Your Bills (on Time!)
Every supplier will put you on the wrong list if you don’t pay your bills. You want to take care of your payments on time, especially if your relationship with the supplier is important to the day-to-day running of your business.
If you don’t pay on time, your relationship with your supplier will suffer. Remember, they will be running on tight margins. Have a reputation as a late payer? You’ll be last on the list of priorities, and they’ll never go above and beyond to help you.
Give Feedback
Not happy with your supplier’s performance? Tell them. Jumping to another supplier may not always be the best solution, as some things are easily fixable as long as you have good communication.
Of course, be polite about it. Be calm, but direct. Give constructive, detailed feedback, giving your supplier the opportunity to rectify issues. If you’re happy with their product and overall delivery, why risk moving to another company?
Be a Good Customer
Our final piece of advice? Just be a good customer. It makes sense on every level. You will get better service, deals, and a smooth working relationship. And it’s just the right thing to do, frankly speaking.