How to Choose the Right Supplier
Supplier “X”, a new player in the home furnishings market, is largely unknown. Supplier “Y” is established with distribution throughout the marketplace. Which one do you choose?
TOP 10 Criteria
- The Right Look. Will the look improve your selection and increase excitement on your floor, given the likely fact that existing product may need to be removed?
- Quality. Does it meet your standards for where you wish to place the product in your line-up?
- Saleability. Without looking at cost, would the product fetch a price point within your line-up that fills a need?
- Raw Cost. Does the cost before freight make sense based on what you believe you can sell it for?
- Landed Cost and Freight. Does the cost after freight make sense for your operation?
- Margins. Will carrying this product improve your overall gross margin?
- MAP (Minimum advertised price). If there is MAP pricing, do the margins improve your overall margins?
- Online pricing. What is the range and degree to which the product is priced by others online?
- Required investment. What are the requirements for the initial investment in terms of floor space, number of SKUs and dollars.
- Reorder lead time. How long does it take on average for stock orders vs custom orders.
“Add up all the results and you have a weighted ranking for selecting suppliers. The ones that have the highest totals in the areas that matter most to you are the ones that you should carry.”