5 Questions to Ask Your Industrial Parts Supplier

Posted by Terotech Solutions Inc. on September 26th, 2018

It is very important to have a clear working your industrial parts manufacturer. This is because a slight hitch in the supply chain can grind your business to a halt if vital components fail and can’t be replaced in time. This is a predicament that many businesses face when their chosen industrial parts supplier. This is why getting answers to all the right questions should be a priority before putting down your signature. Here are the questions to ask;

1. Is there a MoQ?

Many suppliers will require that their customers make a Minimum Order Quantity ensure that they make reasonable margins from each order. But a supplier could make a high MoQ demand that could leave you with inventory that is sitting on your capital. If you replace a part in every 3 months, for example, and a supplier has a MoQ of 5, you could be looking at significant capital held up in the remaining 4 parts that are not immediately needed.

2. What discounts apply?

If you are an industrial electronics components Peterborough reseller, you need to know the type and rate of discounts that the manufacturer offers to ensure your margins are reasonable. The most common discount type is the volume discount. This simply means the larger your order is the cheaper the cost per unit becomes.

3. What are the payment terms?

If you are a reseller or use the components to make items for the end consumer, it is likely that your cash flow is not very flexible. This is why you need to know the terms of credit on offer. If you are a reseller a 60-days credit term would be sensible. If you are an assembler you would ask for a 120-day credit payment term.

4. What happens in the case of late or missed deliveries?

Delays and misses in deliveries can make your business come to a halt with accompanying losses. Will the supplier offers a discount of this loss in the next shipment? It is important to establish what happens when your business makes losses due to the manufacturer’s fault.

5. Who takes liability for faulty parts?

Your industrial parts manufacturer Peterborough should be clear on what happens when the end consumer returns products that have faulty parts from the manufacturer. Who bears the costs of replacing the faulty parts?

These are the top questions you need to ask your industrial electronic parts supplier to establish a smooth working relationship and protect yourself from losses.