Module 12 : Dealing with Suppliers and Receiving Goods

12.1    How to Ensure You have the Correct Suppliers

Thanks to the Internet and the speed of business,
there are no longer restrictions placed upon you when it comes to choosing
where you get your products from.

However, you should not just choose the
supplier that appears to be offering you the lowest price, because even though
it may be appealing to potentially save money, there is no doubt that it could
end up costing you more money in the long term.

In order to get the correct suppliers, you will
have to do your research. This is something that you can do yourself, but we can provide you with a number of tips to
make sure that you do not make expensive
mistakes.

Research,research,research

This is something that you must be willing to spend
a considerable amount of time on because of the potential for it to go wrong. It is no longer a case of finding a company that has what you want and
at a
price that you like, because
you must also take into consideration the other aspects
of dealing with the company.

Are they reliable?

Have you heard of them before?

This is tied in with the concept of research, but
it does help if you have heard of the company before you select them as your supplier. It can often be quite risky to go ahead and spend money on a company if you have never heard of them before.

How quickly will they get products to you?

This is one of the most important points that you
need to consider before you start using somebody as your supplier. The last
thing you want is to discover that they take forever to send the products out to you because that can put extra
strain on your stock management procedures and it also increases the chances of you having empty shelves because they
cannot get the products there on time.

What is their ordering process like? 

When you are looking at using somebody as your
supplier it makes sense that you get a better
understanding of their actual ordering process. How easy is it? What are
the terms by which you have to
operate? Are there any minimum quantities which you need to be aware before
they will even think about delivering to you?

What are the terms?

It is important that you are
aware of the terms of the supplier before you get too involved in a
relationship with them. How do you pay them? Is there any credit and if so what
are the rules behind it? Getting to grips with the terms is something that any
retail manager must understand before one single order is placed.

Are there any additional charges?

Finally, you need to find out if
there are any additional charges when using the supplier before you agree to
anything. You may find that some suppliers will charge extra depending upon
your location or the speed at which you need products. You must also check that
the prices you are quoted are either with or without tax since that will make a
huge difference to the end price that you pay. The last thing you want is to be
caught out with surprise charges since that will only put pressure on your own
profit margins making life even harder for your store.

As you can appreciate, there are a number of
important points to think about before you get too tied up with any supplier.

One of the key things to keep in mind is that there
are a number of different suppliers out there,
unless you are seeking some specialised product,
although that is highly unlikely.

There were 542,000 businesses operating in the
retail sector in the UK at the start of 2017, 9.5% of all UK businesses.

Source: ons.gov.uk

12.2    How to Receive Goods in the Correct Manner

Next, we need to jump forward slightly
to a point whereby you have
selected the supplier and goods are on their way to be delivered to your store.

It is important that any store has a particular
procedure for receiving goods as there must be a paper trail that can be followed back if there are any problems
in the future. That is what we will focus
on in this part of the module.

As soon as a supplier appears at your location, you
should be aware of what you need to do regarding paperwork to satisfy your own
accounts.

However, aside from checking the quantity, you must
also check the price that is quoted on the delivery note,
if this is part of the delivery. Of course you should already
know how much you are going to be charged in advance and,
once again, this is your perfect opportunity to double-check that there are no differences. This applies no matter if
you are buying on credit or paying at the time as mistakes can happen anywhere.

One of the main things that you need to be focused
on when receiving goods is that the paperwork
that comes with the products is correct.

Some companies tend to have rather complex
paperwork with several copies and you have to make sure that you get your
specific copy. In addition, you need to check every single detail on the paperwork and do not just assume that
everything will be perfect.

For example

You need to be sure that the contact details are
correct alongside the full order list. We have already mentioned the need to check the price and do not be afraid to
stand there and calculate it before you sign anything,
especially if there appears to be a difference between
what you expected
and what you have received.

This may all sound a lot of work when there is
going to be very few occasions where something is wrong with the delivery, but you have to remember that any
mistake is going to cost you money and as
the manager of the retail store this is something that you cannot allow to
happen. Remember, wasted money is
going to hit your profit margins and you should always be prepared to contact
the supplier should there be an issue with the paperwork
so it can be cleared
up as quickly as possible.

12.3    Dealing with Damaged
or Problem Goods

Finally, we need to address
an important point
that may happen from time to time, the issue of damaged
or problem goods.

It is a fact that there will be times where goods
that you have ordered from your supplier turn out to be damaged or not as you expected.

This is often just an honest mistake and it is
important to remember this, especially when things could be damaged en route.
This means that you should never lose your temper or get annoyed at the supplier. Doing this will only lead to
them turning against you, and you need to have your supplier on your side so that any problems can be rectified
immediately.

On most occasions, if you explain what the issue is
with the products, then you will tend to find that most suppliers will replace them straight away because they want to build that customer
relationship with you. However, you will need to return any damaged goods,
unless it has basically been destroyed.
This will allow the supplier to write it off and it helps to have that evidence in place.

From your own perspective, you should make sure
that you note any damaged goods and have your own system for reporting
such an issue. This is going to be useful if you have an issue in getting the supplier to replace the damaged goods
because you need to be able to write those
damaged goods off against
your profit and for the sake of your records
and accounts you need to have this evidence.

As we mentioned earlier, it is important that you
handle this situation well because accidents do happen and if you are calm and
collected, then on most occasions your supplier will work with you to resolve
the problem. However, just as you may tend to get annoyed or irked by customers
that are perhaps not as helpful as
you may like, then the same could be said about you and your suppliers; because you must remember that in this
instance it is you who becomes the customer.

When dealing with the reporting of
damaged goods it is important to make sure that you notice the issue as quickly
as possible in order to give you the best chance of having the situation
rectified as quickly as possible.

You should make sure to factor into
your figures that some goods will indeed be damaged in some way making them
unable to be sold, but the percentage is so small that it should not pose a
major problem for you or your store.

MODULE SUMMARY