For customers, there’s nothing more frustrating than having to wait for a much-needed item to arrive on the doorstep. Waiting even just a few days can feel like an age in this interconnected economy – and so it pays dividends to make sure that your firm’s suppliers are on your side. This post will explain more about the importance of a speedy supplier.
End customer satisfaction
By far the most important reason why it makes sense to have speedy suppliers on side for your business is that it means you can satisfy your customers more quickly. According to one study referred to in Material Handling and Logistics magazine, nearly 90% of customers say that shipping time influences their decisions about where to buy. But it also just makes basic business sense. As a provider of goods in a hyper-competitive market, you’re likely to secure better reviews and more repeat customers if you can get the items to where they need to be faster than your competitors. Same day shipping is increasingly becoming the norm for many popular goods and designing a supply chain that offers that is soon likely to become essential.
During the current coronavirus pandemic, it’s perhaps the case that some customers at least are more understanding when it comes to supply chain breakdowns. This is, after all, an unprecedented time. But soon, there will be a return to the way things were before – and it’s important to make sure that you have strong supplier relationships in place ahead of the return to normal.
Your cash flow
But there are also other reasons why it makes sense for your business to only work with suppliers who have fast turnaround times. In most cases, it makes little sense for businesses to keep large amounts of cash in the bank waiting to be paid out to cover supplier invoices. With interest rates at an historic low, having lots of cash in a business bank account is, in real terms, a loss when inflation is factored in. But when a supplier takes a long time to send you your goods for you to then sell on, you can easily find your ready cash building up with nothing to show for it.
If your own firm is having cash flow problems, it may feel like a blessing in disguise for a supplier shipment to be delayed as it could mean you can delay paying the invoice. But getting into a habit of doing this have a negative impact on your customer base, as, over time, it can mean you develop a reputation for institutionalized shipment delays. It’s better to tackle the root causes of your own cash flow problems and shift your focus to providing an excellent service.
In the age of consumer choice, then, not providing goods and services on time can be a real deal-breaker for your customers – and it can hurt your cash flow. If you don’t already have a time-friendly set of suppliers in place, it’s important to act to safeguard your firm against future problems.