Top Supplier Issues and Recommended Solutions


Pro QC's Managing Director is noted as asking teams for solutions rather than just stating problems. This type of thinking encourages the teams within the organization to employ that strategy with clients as well. Results from a 2014 survey by Eric Evans & Associates into the most commonly found supplier problems noted the following: * No information on what is happening at suppliers (~85%) * Late delivery (~65%) * Price increases (~63%) * Invoice errors (~60%) * Unacceptable quality (~45%) * Poor ability to cope with fluctuating demand (~35%) * Supplier financial problems (~20%) The top three issues clients contact us about here include: 1) Communication: No information on what is happening at suppliers. It's not uncommon for us to receive feedback from clients and others where they are not receiving updates or other information from suppliers in a timely manner. This feedback can even start in the initial supplier identification process and carry throughout the relationship. Considerations include: * Time zone differences * Language barriers * Cultural considerations (issue avoidance) * Lack of priority as a customer The suggested solution varies and might include enlisting the assistance of a local representative to either visit the supplier regularly to monitor progress, or make regular calls during their business hours to discuss activities. Having someone local host regularly scheduled calls among all parties is also a consideration. Sending follow-up notes to calls via email and requesting confirmation is an additional way to ensure communication barriers are not as impactful. Providing as much visual representation as possible assists here as well. Setting up communication expectations, such as activity milestones, can be done in advance during the supplier selection process. Accommodating time zone differences can foster a better supplier relationship as well. 2) Late Delivery: The supplier provides a ship date, but continuously delays. A number of variables can be the issue here. A few of the most common include: * Larger orders from other customers can take more of a priority * Issues with raw materials (inventory or quality) * Miscalculation of production capacity * Issues with equipment * Sub-supplier delays A proposed solution would be getting someone local on-site to discuss the issue(s). More proactive, and local, follow-up to ensure timelines are met can save significant time and associated cost. On-site visits can be scheduled regularly to monitor progress per commitments. A situation where there's an issue with equipment can be quickly addressed and resources secured if the supplier lacks the ability to resolve or has otherwise not made it a priority. 3) Unacceptable Quality: The supplier is shipping product that is non-conforming to specs or other requirements. Again, several things can be contributing to this issue. It is not unheard of for a supplier to indicate they have everything they need, run production and then ship product that doesn't match the requirements you provided. * As a smaller customer, less attention is likely given by management and others. * Suppliers might not actually have sufficient internal engineering or quality support. * Communications might not have been received and interpreted clearly. * There is a high turnover or other training issue noted. * There might be an issue with the quality of the raw materials. A proposed solution is having someone communicate or otherwise visit the supplier to determine the root cause of the issue. Once corrective actions are identified and worked through, in-process and pre-shipment inspections can be employed for verification. Cultural considerations can aide in the corrective actions here, such as understanding not to focus on blame but rather improvements. And, maintaining respectful communications throughout the improvement process goes a long way towards issue resolution. Of course, selection of capable and reliable suppliers is a first step in preventing issues. But, even the most carefully selected supplier might still surprise you as the relationship is developed. Contact us for additional information regarding how we can assist in developing and executing solutions to your supplier challenges.

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