Do you have a shortage on a component? – Is your production is about to stop? Your instinct is to fire-off the inquiry to as many suppliers as possible thinking this will give you the best chance of finding the stock.
STOP! Remember these 3 golden rules
1. Pick one trusted supplier and give them the enquiry first
A shortage means that there is limited stock out there in the marketplace. And if you have multiple suppliers all chasing down the same stock. This has one effec, to push your price up. It is much better to give the inquiry to just one, trusted supplier, one with experience of the shortage market.
2. Where possible, give the trusted supplier a realistic target price
This rule is quite an important one. The more information your chosen supplier has, the better and quicker they can negotiate with the stock holding company. Please try to be realistic with targets. We all know that in a shortage situation, pricing hardens. That component you normally purchase for £1.00 will almost certainly be more expensive in a difficult marketplace.
Calculate what you are willing to pay and let your chosen supplier know that you are happy to go to this figure. If you can, give them the go ahead to place the order immediately if they can secure the stock at the target price or below. Speed is of the essence, stock is being snapped up within minutes of being advertised. There is no better negotiation tool for your chosen supplier than an order in hand ready to place.
3. You don’t have to go to a shortage broker to find stock…
In fact, we believe you are better if you don’t. Let me explain…
Orbit has over 20 years’ experience of sourcing shortage products for our customers. Unlike some “component brokers” that show little loyalty to customers & may never deal with them again, Orbit model depends on long-term repeatable solutions, the shortage market is a service we offer to help our customers out of trouble. This means Orbit keeps the same, sensible, fair level of gross margin on shortage items as it does on our customers everyday, long-term solutions and products.
So yes, we will go to the same sources as the brokers, but, we will not add the levels of profit that some of these brokers add during crisis times. As a long term supply partner, Orbit would prefer to ensure our customers get a fair deal and the product to keep their production flow running. The company Mission Statement is the foundation of this rule.
If you’d like to know more about how Orbit can boost your business, please contact the team on +44 (0)1782 564757.