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Choosing the Right Business Suppliers - some handy advice for startups and SME's

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by Startacus Admin

choosing the right business suppliersSteve Pritchard is the founder of Proovide a B2B dating site, helping to introduce startups and SMEs to the right suppliers for FREE. Below he shares some valuable advice to startups and small businesses on choosing the right business suppliers. Over to Steve to explain all...

"A business can’t afford to waste money on the wrong supplier and this is even more crucial for startups, where every penny is vital.

Choosing the right supplier for your startup could make the difference between success and failure. What started as a customer and provider relationship could develop into a great partnership and profitable collaboration.

My Top 4 things to look for when choosing a supplier to work with:

Quality and reliability

The quality of the goods or service needs to be consistent - your customers will associate poor quality with you, not your suppliers. Equally, if your supplier lets you down with a late delivery or faulty goods, it could mean you will in turn disappoint your customer.

Speed and flexibility

Being able to place frequent, small orders lets you avoid tying up too much working capital in stock. Flexible suppliers help you respond quickly to changing customer demands and sudden emergencies.

Strong service and clear communication

You need your suppliers to deliver on time, or to be honest and give you plenty of warning if they can't. The best dealers will want to talk with you regularly to find out what your needs are now and how they can serve you better in the future.

Financial security

It's always worth making sure your supplier has a sufficiently strong cash flow to deliver what you want, when you need it.

The above are the must haves for short listing potential suppliers but selecting the perfect supplier for you requires research.

Cheap is not always best

Focusing on the best supplier you can afford is a more solid investment than just picking the cheapest. There can often be overlooked reasons why a supplier’s price is the choosing business supplierscheapest and these may not necessarily be in line with your brand.

Researching a supplier’s business model, experience and staff can help you understand how a business can operate at such low profit margins. If a price is well below the average, they may be under-resourced to deliver what you need, when you need it or it could just be that they have few overheads.

I always recommend choosing a supplier based on their proposal falling within the minimum and maximum of your budget as this helps to reduce risk of wasting money further down the line due to the supplier having under-priced their service.

Research past clients

As many of us do with our holidays and mobile phones, checking the reviews, or customer feedback is a great way to find the supplier or product to fit your needs.

A company may proactively supply you with contact details of a client, which is great, but I recommend you do your own research by finding an existing or past customer and contacting them directly. This helps you to get some impartial feedback and if you can do this with a few of their clients you should have a solid understanding of the supplier’s approach.

Credit check your suppliers

It should go without saying that if your startup relies on the traditional invoicing and payment terms, then credit checking your customers could save you hassle and loss of revenue.

Your suppliers are just as vital to your business, especially if you are a reseller or distributor. Their financial status is linked to your business and your customers, so making sure you have done your due diligence is important.

Also, just because a supplier may be having financial difficulties at the moment, doesn’t mean they can’t deliver, but I would recommend you at least pay on or after delivery and use it to negotiate further.

Build good relationships

As a startup, every connection could potentially be a new customer and I have found that building good relationships with suppliers is a valuable source for new customers or choosing business suppliersgreat for just helping to promote the business.

Your startup’s success is intrinsically linked to the supplier’s bottom line, so a good relationship is a profitable venture for both parties. It can also sometimes be used to your advantage, perhaps if cash flow was an issue and you couldn’t pay their invoices on time.

Good communication with your supplier is important for the good times and absolutely vital during the bad. A great relationship can help you build a solid support infrastructure, which can help reduce pressure on your startup.


Customers are vital to any startup but a supplier is equally as important to help deliver your service or product. Therefore, investing time in finding the right company can save you both time and money.

Once you have found the right supplier, you need to continue to work with them, building a strong relationship, which will survive the rollercoaster that is the first 12 months proovideof any startup."

About the author

Steve Pritchard is the founder of Proovide a B2B dating site, helping to introduce startups and SMEs to the right suppliers for FREE. Each supplier is scored using over 140 different third party metrics plus a wealth of information to help make informed decisions. You can also find out more about Proovide by reading our recent interview with Steve Pritchard

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Published on: 3rd March 2015

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