If the success of your business depends on inventory, parts, inputs, or other entities’ products, you'll vendors and suppliers who will help your operations run smoothly. What matters? For most, it’s on-time deliveries, consistency in quality, item availability, and ease of communication. Finding vendors and suppliers who can live up to these requirements isn’t as easy as it seems. Here, we’ll walk you through the questions you should ask as you interview a new vendor for your supply chain.

A quick note: You can find many answers to these questions in the contracts your vendors or suppliers offer. Refer to this resource to learn how to review the key points:

How to Review Vendor and Supplier Contracts

Your business may depend on numerous vendors, suppliers, and distributors who have unique policies, procedures, and practices. Before signing agreements with them, you’ll need to review the contracts they provide and ensure that the terms suit the needs of your business. This task is one that’s best handled by an attorney. But in this article, […]

Read More

www.owneractions.com

Key interview questions to ask a new vendor or supplier

Questions related to production and delivery:

1. How frequently do you change your product lines?
2. Do you have plans to adapt or introduce new offerings in the near future?
3. Can you flex to meet changes in product demand?
4. What are my recourses for non-delivery or late deliveries?
5. Am I granted an inspection period before submitting payment?
6. What is your return policy for defects, damages, or unsellable items?

Questions related to quality:

1. Does your business have any quality certifications?
2. What processes do you have in place for production, inspection, and quality assurance?
3. Can I have samples of your materials?
4. What commitments can you make on the quality of your deliverables?

Questions related to technology:

1. What steps do you take to protect the information you collect or store about my business?
2. Would you be willing to complete a security audit?
3. Can you demonstrate the software or apps I would need to use to work with your organization?

Questions related to service and support:

1. Will I have a primary point of contact?
2. What kind of response time should I expect from your team for standard inquiries?
3. What modes of communication are available to connect with your business?
4. During which hours can I expect to reach someone in your business?
5. Is there a way to reach the support team in the event of an emergency?
6. Can I talk with your customer service team before deciding whether to proceed?

Questions related to costs and pricing:

1. What are the total costs of delivery?
2. What strategies would you recommend for driving down the costs of my product lines?
3. Are volume discounts available? If so, what are the breakpoints?
4. What fees or penalties could I incur for late changes to deliveries or cancellations?
5. What are your payment terms and are they negotiable?
6. Can I receive a discount for paying in advance?
7. How frequently do your prices change?
8. What might cause the next increase in your prices?
9. How much advance notice will I receive for price changes?
10. If your organization’s costs decrease, will you pass along a portion of the savings?
11. How much markup would you recommend on your products?

Questions related to collaboration and competition:

1. Does your business sell directly to my customer base?
2. Do you have success selling to any of my competitors?
3. Could you pass along leads that might benefit from my business?
4. Can your business do a better job of improving my bottom line than your competitors? If so, explain how.

Questions related to their practices and stability:

1. Do you have experience with any businesses like mine? If so, what have been some of the challenges you’ve had to work through?
2. Does your business have liability protection? If so, can you provide a copy of your liability insurance certificate?
3. Is your business facing any financial challenges? If not, would you be willing to prove your business’s financial stability?
4. What changes do you see on the horizon in your industry, and how are you preparing for them?

These interview questions can help you make smart selections about any new vendor or supplier you choose to work with.

For more articles and advice on manufacturing, cost savings, quality, and distribution, log into your owner’s portal.