Retailers should always be open to welcoming new suppliers. Not only will retailers be able to cater to more customers, but they can also offer more products and services. As beneficial as it can be to work with new suppliers, it can also be complex. This is why businesses should have a robust onboarding process in place to keep things running smoothly.
Retailers can implement an effective supplier onboarding process by including the following in their new supplier checklist:
1. Research the Supplier Beforehand
Choosing to hire an inexperienced or unreliable supplier will only cause problems to your business, which is why conducting research beforehand is critical. Retailers can conduct research about a supplier by doing a simple internet search or by asking for recommendations from other business owners who have worked with the same supplier. The more you know about a company, the easier it will be for you to identify if they are the right fit for your brand.
2. Issue A Request For Proposal (RFP)
It is better for retailers to work with suppliers who can understand and provide their business’s unique needs, and this goal is only achievable when issuing a Request for Proposal from the suppliers that are shortlisted.
Within the RFP, make sure to highlight all of your business’s technical requirements and objectives. Indicate what products and services you require from the supplier and ask them about every point that is mentioned in the RFP. Doing so will make it easy for retailers to assess which suppliers can cater to their specific needs.
3. Compare Your Options
Once the suppliers have submitted their respective RFP’s, retailers can start comparing their offers and payment terms. Depending on preferences, brands can compare suppliers by using a spreadsheet or a software platform that comes with a supplier comparison feature. This process enables you to weigh the pros and cons of each supplier and see which ones can better suit your needs.
4. Develop an Exit Strategy
It is difficult for a business to find the right supplier and continue to work with them for years at a time. More often than not, problems occur that requires the business or the supplier to cut ties with the other. This is why retailers should develop an exit strategy before welcoming a new supplier to their business. This strategy should include information on how business resources will be returned or how quickly the supplier can be replaced.
5. Provide Instructions to Common Business Processes
Regardless of how small your business currently is, certain processes have to be followed to ensure that the brand continues to provide products and services to the public and prevent any errors along the way. When welcoming new suppliers, retailers should provide accurate instructions to common business processes that they will be involved in.
Most businesses will require their suppliers to fill out supplier information forms, or W-8 or W-9 forms, which allows business owners to request the supplier’s tax identification number. Following this process means providing the necessary forms to the suppliers before doing any business with them.
Also be sure to inform your suppliers about any business payment terms, invoice processing, and pricing and discounts. Informing suppliers about these processes as early as possible can eliminate errors and missing information during the length of your transaction.
Creating an effective supplier onboarding checklist does not happen overnight, so make sure to put in the time and effort to implement changes along the way. After you have created your first checklist, you can then assess which processes work and which ones do not, and improve your weak areas.