Almost every business uses suppliers of some sort. Even if you are ordering toner for your printer and paper clips, odds are you are using a supplier. To get the best deals, a business must build strong relationships with suppliers, and that means shopping around.
Not All Suppliers Are the Same
If two suppliers offer the same products, you need to make a closer comparison. Are their prices the same? Do they offer financing options on larger orders? Do they offer lines of credit to their clients? How knowledgeable are their employees and do they understand your needs? A little research can go a long way so don’t be afraid to ask questions.
Lines of Credit from Suppliers
Not all financing plans and lines of credit offered by suppliers work the same way. Some suppliers keep their accounts in-house. That is, they do not report information to a credit agency. It is of the utmost importance that your suppliers submit credit reports to an agency, because it can have an unseen benefit. You can make large purchases every single week and pay off the balance ahead of time, but if your supplier isn’t reporting your activity, your business credit ratings stagnate. Building a relationship with a supplier who reports information to one of the big agencies can greatly improve your credit ratings in a short period of time.
Paying Your Suppliers
Building a strong relationship with your supplier is a two-way street. They will offer discounts, lines of credit, financing options, and even take special requests, and all they ask is that you pay your balance on time. Settling your accounts on or ahead of time puts you in good standing with your suppliers, and may even open up further opportunities. If you want to really get on your supplier’s good side, refer other business associates their way and give them more sales. Reciprocity is the key.
Never Delay Payments to Your Suppliers
One way to ensure you always have the capital on hand to make large or small purchases is to factor your own customer invoices. When you make a sale, your business needs that revenue to purchase supplies and materials for orders in the pipeline. Instead of waiting a month or more, factoring can convert your receivables to cash within 24 hours, so you can purchase what you need, when you need it.
New Century Financial offers the most comprehensive factoring services nationwide. Contact our offices today to learn how we can help your business grow.