Keeping The Risk On Suppliers
PurchTips - Edition # 29 August 12, 2003
By Charles Dominick
Have You Used These Techniques To Manage Risk?
When contemplating the purchase of a new product or service or doing business with a new supplier, you face risk. Many bad things could happen, including:
- The product or service could be of unacceptable quality
- The supplier could fail to perform
- The supplier may go out of business
There are consequences if these things happen. Your organization could lose money. Your organization may fall behind on its schedule. Your reputation as an excellent purchaser could be tarnished.
As an agent of your organization, you must take steps to protect your organization from this risk. While risk management is a topic that is way too extensive to comprehensively cover in a one-page article, here are a few tips for managing risk when dealing with a new product, service, or supplier:
1. Get A Sample Before Making A Long-Term Commitment
If you're buying a product, ask for a low- or no-cost returnable sample of the product so that your organization may assess its quality. If you're buying a service, have the service performed on a one-time basis for the same reason. There is no better proof that a product or service will suit your needs.
2. Ask For A Money-Back Guarantee
You shouldn't lose money if you are not satisfied. Ask for a money-back guarantee. If the supplier declines, you're probably best not doing business with that supplier. After all, why should you have the confidence in the supplier's product or service when the supplier doesn't? If the supplier offers the guarantee, the load on your shoulders is much lighter.
Spotlight On Professional Development Opportunities
Smart suppliers know that minimizing the buyer's risk is part of their job. For example, Next Level Purchasing, Inc. offers online training for purchasing professionals. Many training providers would think that there is no risk to their customers. But Next Level Purchasing, Inc.'s staff are all purchasing professionals. We know that the buyer faces risk.
We help our potential customers address risk. Here's how:
First, we offer a FREE mini-course: "Managing Supplier Performance." If you are interested in one of our full-length, for-a-fee classes but don't know if you'd like online learning or if we're qualified, taking a FREE mini-course gives you a no-obligation way to ease your concerns.
Second, we offer an unconditional money-back guarantee. If you're not satisfied within seven days of taking our class, you get a hassle-free refund. This ensures you that your money will not be wasted.
Do you want a more comprehensive lesson on risk management? You can learn in-depth ways to reduce your purchasing risk in our online class "14 Purchasing Best Practices."
For a full description of this and other classes, please visit:
Would you like to test drive our purchasing training? We invite you to take our FREE mini-course "Managing Supplier Performance." This course will teach you how you can improve relations with your suppliers for better performance.