Most problems between business owners and suppliers can be avoided if business owners will practice the habit of using multiple suppliers. Some business owners have only one supplier because they don’t want to search for other suppliers. But the reality is that in most local areas, several businesses act as wholesalers for identical products that microenterprise owners need in their business. Having multiple suppliers enables business operators to bargain for low prices, take advantage of sales, and get the things they need when they need them. It could also enable business owners to get credit from more than one supplier.

Jaime had an experience many years ago that taught him the importance of having multiple suppliers and using his power as the buyer to demand good service. Jaime used to purchase a large amount of medical equipment from one supplier. The supplier treated Jaime fairly; however, his customer service was poor when Jaime had a mechanical problem. Jaime had a feeling that the poor service was the result of the supplier’s belief that he had all of Jaime’s business.

So one day, Jaime called four other suppliers and asked each supplier to meet him at his store the following Friday morning for a one-on-one meeting. Jaime posted the names and appointment times of the competitors on the blackboard behind him in such a way that each salesperson could see the competitors’ names behind Jaime as they spoke at the desk. He then made sure that his main supplier came in that afternoon to check on a problem he was having.

When Jaime’s main supplier came in that afternoon and saw that Jaime had spoken with the suppliers’ competitors, the supplier quickly understood the message that Jaime expected him to continually “earn” Jaime’s business.

As a microentrepreneur, you need to seek out multiple suppliers and help the suppliers understand that your business needs to be earned with every transaction. When suppliers know they are in competition for your business, they will most likely treat you very well.

Selecting Suppliers

As you search for multiple suppliers, you will obviously want to find suppliers who will sell to you for a reasonable price. But be sure to also consider some additional issues; examine the supplier’s reliability, speed of service, delivery costs, trustworthiness, and depth of inventory. Remember that if a supplier can’t meet the needs of your business, your business will not be able to meet the needs of your customers.

When you start your business, you will most likely be very small and need certain credit and price considerations. Many times you may need to ask for special favors from your suppliers. Be wise as you select your suppliers: look for ways to decrease the wholesale prices you pay for products and services. Researching suppliers’ credit or consignment programs can also help you pay less for the products that you resell.

When you begin a new business relationship with a supplier, don’t be afraid to ask for special pricing, terms, discounts, and new-customer promotions. This is all part of the gathering process. Remember that you often make more money by purchasing at a good price rather than by selling at a high price.