Our previous posts talked about how to find the right manufacturing partner and why it is often good to spread your supplier risk by partnering with multiple companies. Today, we dive into the dos and don’ts when it comes to investing in a long-term brand supplier relationship.
Managing supplier relationships is of crucial importance to brands. Close partnerships have proven to be of particular importance during difficult times like the COVID-19 pandemic.
In a true partnership, both parties can openly discuss challenges and work towards mutually beneficial solutions. In addition, close partnerships can also ease various risks throughout the supply chain.
Brands can end up in established relationships with suppliers without having crucial knowledge of their own products and production processes.
Knowledge Sharing
Bigger suppliers, for example, often have MOQs or payment terms that are unfavorable to smaller brands. Therefore, you should pay close attention to your position, rather than the supplier in question, and find out under what conditions there will be collaboration. These details prevent you from entering into a relationship in which you have little to no bargaining power.
Suppliers often withhold essential information from brands—such as the Bill of Materials (BOM), a list that identifies all materials and components needed to manufacture a product. Brands can end up in established relationships with suppliers without having crucial knowledge of their own products and production processes. This lack of information is very risky for brands and can make them particularly vulnerable.
A solid long-term relationship can also help your brand to take steps in sustainability.
Sustainability
A solid long-term relationship can also help your brand to take steps in sustainability. If this matters to your brand, then there are a few questions that you should consider.
- What does sustainability mean to your brand and is this aligned with the vision of your supplier?
- Do you want to focus on sustainable materials?
- Do different printing techniques or eco-friendly packaging matter?
- Is the welfare of the people making your products crucial to your brand?
- Do you want to use your supplier as an extension to your brand?
If you are both committed to a long-term relationship and share similar ideas, investing together in the right products and methods can make sustainability more feasible.
One of the main benefits of having a strong long-term relationship with your supplier is a fair and equal relationship reflected in how you work together and mitigate risk.
Ideally, your work towards the same goals can be open and transparent, and you can help each other when things go wrong. In a good partnership, like any relationship, both parties have a healthy amount of give and take.
Are you interested in discussing the topic of investing in a long-term brand supplier relationship with us? Perhaps you want to learn more about our manufacturing solutions.
Contact us today and discover what a relationship with Pactics can do for you.
