Why Your Supplier Going Out of Business Is Actually Good

suppliers should offer overall value not just moneyThe other day, some friends and I were discussing car insurance. We talked about which carriers we use and how long we’ve been a customer. One of my friends was with their company for 17 years, before he finally switched – and that was only because he got married!

Thinking About Overall Value

Most of the time, we think of comparison shopping as a pain. No one really wants to invest the time, so we just use the same products and services we’ve always used – even if we aren’t getting the best value. And value doesn’t just have to mean money; it’s the overall experience: customer services, reliability, return on investment, and even company business practices.

This isn’t just limited to consumers. Businesses are the same way. In fact according to B2B International, “40% to 50% of companies have not introduced any new suppliers of a product in the last five years. For many buyers it is easier to carry on dealing with their existing suppliers than to make a change.”

But what happens when your company is forced to make a change because the manufacturer has gone out of business? While initially it might seem like a pain to have to find a new supplier, it can actually be a very good thing. This is the time to re-evaluate and decide which new supplier will offer the best overall value – not just the best price.

What to Look for in a New Supplier

When your business is looking for a new supplier that will add value to your organization, there are a lot of things to consider. Here are just a few to help you get started.

Evaluate Cost – But Not Just Upfront Costs

No matter what you’re buying, “how much does it cost” is usually the first thing that’s asked; however, the conversation shouldn’t stop there. Return on your investment is equally important. Beyond the price, one question to ask is “can you reuse the product”?

As an example, we offer both movable walls and modular casework as alternatives to drywall and built-in furniture. While the upfront costs might be higher for the products, the fact that you can reuse and adapt the products when business needs change instead of tearing down walls or buying new furniture makes them a worthwhile investment.

With just one move or layout change, you can recoup the money spent. Not only that, but you save additional money not having to pay for extra contractors, delivery to landfills, or loss of productivity due to down time.

stat about companies introducing new suppliersDo a Bit of Research on the Supplier

Just like you look at online reviews to decide which restaurant you want to eat at or ask your friends which phone company they like, you can do the same for businesses. Many businesses have testimonials featured on their site.

You can get an idea of what their clients have to say about them. Even though it’s probably all positive feedback, you can at least figure out one or two main positives about the company – like their customer service or product reliability. (We have numerous customer testimonials you can find on our website here).

Another thing to look for on a company’s website is case studies. If the company has a history of helping businesses just like yours solve their problems, you’ll know they can handle your concerns. (Curious to see our case studies? Find them here.)

Finally, you can reach out to other organizations in your industry to see who they use as their supplier. If they use one that you are researching, ask about their experiences.

Should You Buy a New Product Too?

What if instead of buying the same product, you purchased something different? Instead of only looking for a new supplier of the same product, it might be time to buy a whole new product.

Many times this works for technology. Your computer supplier has gone out of business, so instead of buying everyone new desktop computers, what if you provided your workers with laptops? You’ve now created a mobile workforce that can get their work done from anywhere.

finding a new product or service supplierBut it doesn’t just apply to technology; it can apply to anything – even something like storage (a topic we are very familiar with!). For example, if you are building a new distribution warehouse and would normally purchase pallet racks, you can consider another product instead like an automated storage system.

Conclusion

At the end of the day, finding a new supplier isn’t the easiest thing to do, but it does gives you an opportunity to find a company that will offer more value to your organization.

If you look for more than just initial price, and focus on return on investment, quality of the company, and what other products might meet your needs, you’ll be well on your way to finding the right company to do business with.

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