The Benefits of a Single Source Supplier
When we buy anything for our business – chairs, car tyres, telephones – we’re told that it’s best practice to go out to at least three suppliers to make sure we’re getting the best value. Which makes total sense – a chair is a chair wherever it comes from so buying at the lowest rate is what we’re mostly tasked to do.
But that ceases to make sense when there’s more depth to the purchase. For example, where there are service levels or consulting that can add value to the purchase. Or where the purchase is complex and combines different suppliers or delivery schedules that need to deliver at the right time in the right place. In these cases, buying the item can be incredibly time-consuming and can mean you miss opportunities to save cost. And, if you don’t do the right due-diligence and find the right supplier in the first place, it can increase risk; putting deadlines in jeopardy or compromising standards.
In these cases, there can be many benefits to working closely with a single supplier.
Take print for example…
For a start, If you’re having to buy multiple types of print for, say, a direct mail pack, then liaising with multiple suppliers can take up a significant amount of time. If your pack includes three items, working on a ‘minimum three quotes’ rule can mean getting in nine supplier quotations. That’s quite a demand on time. Multiply that by several campaigns and the cost implication can be big.
And that’s just pre-order. A lot of time can also be spent managing multiple suppliers post-order, especially if the project is complex, where buyers can quickly run into problems. It can also be difficult to make any one supplier accountable if something goes wrong as they have a habit of blaming each other (note the weary voice of experience here!)
Finally, if you need performance reporting, then it can be very time consuming, pulling together different reports from multiple suppliers. The right single supplier should be able to do it for you, giving you the complete picture without wasting time.
There are many ways working with a single supplier can help you spend less.
Pooling your spend with a single supplier with buying power, can significantly reduce prices as you benefit from their economies of scale. And if you find the right supplier with the right expertise, they can also suggest ways to, not only improve product effectiveness, but to re-engineer them to be more cost-effective to produce. If your single supplier is a print management business who buys from many different printers, then there’s even more scope for re-engineering and cost-saving across a wider range of print.
Your single source supplier can also help reduce waste (and therefore reduce cost) on similar jobs by batching them together on-press. And where jobs don’t naturally batch together, they can advise on re-engineering products so they do – often reworking products so they improve impact (and therefore ROI) at the same time. Where you can do it, there can be substantial cost savings.
As you increase your spend with a single supplier there are extra benefits to be gained. They can benefit from spend visibility, allowing them to better plan production in advance and develop improved, more efficient processes which lead to lower costs for you and your supplier.
Using a single supplier for your entire production is also a great way to mitigate VAT, because different VAT rules apply to printed items sourced using single suppliers. This means, for example, if you produce a direct mail pack, having a single supplier produce and distribute the pack for you, you’ll stand more chance of paying less VAT.
More Effective Campaigns
When you work closely with a single supplier across campaigns, they get a clearer understanding of your business and can then suggest improvements to campaigns which will help drive up response rates and ROI. This requires a close relationship with your supplier who must, in turn, have a broad understanding of print innovations from many different suppliers.
Brand & Environmental Compliance
Your single source print supplier will go that extra mile to help you look after your reputation. They can help with brand compliance, ensuring brand and colour guidelines are adhered to across all your print. Or they can help with environmental compliance, suggesting environmentally sustainable methods of production and distribution – all of which has a direct and positive impact on your brand image.
Of course, most of us are risk averse, but using a single, financially-stable print partner, can mean it’s easier to manage and reduce your risk. The consequences of badly managed risk can seriously affect your company’s bottom line – not just if a printer goes bust holding your stock, but in terms of missed deadlines and trading opportunities, all of which can be incredibly stressful for staff to manage.
Not many of us have the resources to effectively manage risk exposure across a broad supply chain – so it can be a far more practical approach to make sure you’re working with one, financially-sound and stable supplier. And if you find one, financially robust supplier who has the mechanisms in place to manage risk among their own printers, then you have access to a safe supply chain without having to manage the entire process yourself.
How to move to a single source supplier
You might well be cautious about moving to a single supplier, especially if you’ve always worked to the three quotes rule or similar. Well, the transition can actually be pretty simple. Here’s what we suggest you do.
- Find possible candidates. You might want to use the list above as a checklist or guide. Ask them to suggest ways they could add value to you and your business. Find one or two pinch-points or problems and let them help you resolve them.
- Try them out on a few projects. Ask for advice on how to streamline production or re-engineer a product to improve effectiveness and ROI. You’ll also find out how well they work as part of your team.
- Try them out on a few quotes on a range of product types. That way you can make sure they are competitive on price across the board.
- When you’re comfortable, add in service levels and negotiate pricing matrices.
- List out what benefits they deliver as you go. That way, you can show your peers and bask in glory. Repeat.
If you need any further information on this or any help with your print projects, Webmart is here to help. Just get in touch for a friendly, no obligation chat by calling 01869 321321 or email us by filling out the form below.