If any of your suppliers experienced challenges that affected their production capability or capacity, would you have an alternate source so you could continue manufacturing without disruption? A variety of factors, including cybersecurity threats, demand fluctuations, health crises, international relations, logistical challenges, natural disasters, and more could impact manufacturer and supplier relationships.
In this dynamic business environment, manufacturers should proactively — instead of reactively — source additional suppliers. By strategically engaging diverse suppliers, you can gain the following competitive advantages:
When you review supplier bids/quotes, do you consider the total cost of ownership? Although the lowest price may seem the most appealing, delivery, inventory, and quality expenses contribute to overall cost. By comparing and negotiating competitive pricing, you can procure a comprehensive financial insight that results in cost-efficiency or potential profitability.
During this same review, do you also evaluate those suppliers, assessing their brand reputation, financial stability, production capability/capacity, and quality assurance? Do you also map the supply chain, identifying geographic concentrations and single points of failure? By reducing vulnerabilities, you can prevent supply chain disruptions that could halt or strain production.
Does your organization value community, inclusion, innovation, safety, or sustainability? Different suppliers may share similar distinctions that can align with your business practices and standards. Similarly, those that embrace innovation can introduce new materials, processes, or technologies. By engaging with strategic primary and secondary suppliers, you can cultivate collaboration, competitiveness, and growth.
Do you experience offshoring challenges, such as communication barriers, intellectual property concerns, logistical delays, trade restrictions, or quality control issues? According to the Reshoring Institute, Americans prefer domestic products and will pay up to 20% more for them, believing they have better quality than those produced in other countries. By reshoring and simplifying your supply chain, you can maintain more control and meet customer demand.
Do or will you manufacture products that need to comply with federal regulations? Certain governmental contracts or projects have specific manufacturing requirements. For example, the Build America, Buy America Act (BABA) requires infrastructure projects that receive federal funding to produce their iron, manufactured, and steel products, as well as construction materials in the country. Additionally, the International Traffic in Arms Regulations (ITAR) governs the export and import of defense articles and services, which includes restrictions with specific countries. And the Defense Federal Acquisition Regulation Supplement (DFARS) governs defense contracts, which have certain cybersecurity requirements.
By taking a strategic proactive approach, you can anticipate potential challenges, enhance decision-making, and foster long-term success.
GaMEP offers Supplier Scouting — a no-cost service that assists manufacturers with searching for and connecting with domestic suppliers that produce critical, hard-to-find, or unique materials
Our experts search and vet local, regional, and national suppliers, conducting confidential inquiries with suppliers to validate their production capability and capacity.