Logistics is an industry that is always on the go, making it one of the busiest in the world! There is no time to slow down or stop, as clients rely on the efficient transportation of their goods to continue their operations. Of course, this means the constant use of transport equipment will undoubtedly speed up wear and tear.
It is usually the task of the fleet or logistics manager to ensure equipment is in good condition, and that hardware is maintained accordingly. Furthermore, they will need to find an equipment supplier to provide them with the necessary products and services to meet the company’s demand.
Choosing the right suppliers will be different for each business based on their individual needs. Finding a suitable partner could be the difference between keeping clients happy or losing their support. In this article, we look at the types of considerations a fleet manager should have when considering equipment providers.
1. Determine What Services Or Products The Business Needs
Before the manager can start looking for suppliers, they need to know what products and services they want from a specific supplier. They also need to have sufficient knowledge about the equipment, its parts, and the quality of the various products to really understand their own needs.
For example, bushings improve efficiency, while ball bearings won’t necessarily have the same benefits. Fleet managers need to understand the potential impact of different parts and equipment failures or issues on their operations.
A transport business could have more than one supplier, as each will have a different role in the process. Some may supply parts only, while others may provide completely ready-to-use machinery. It will all depend on which part of the logistical chain will require products or services, so each transport company should make its list of requirements to follow.
2. Choose A Supplier Based On Selection Criteria
Making a list of suppliers that can provide the same product or service will assist the manager in having a backup in place in case the usual supplier can’t help with something specific. However, each supplier should pass the selection criteria for becoming a supplier, and ignoring any potential problems could harm the brand’s reputation more than they realise.
These criteria could look like the below:
- Do they supply quality products or services?
- Are they flexible in terms of deliveries?
- Can the company rely on them?
- Do they have a return or refund policy?
- Are others satisfied with their service?
- Is the supplier licensed and health and safety compliant?
- Can they offer different payment options or discounts?
- Do they have maintenance or after-sales service?
- Are they willing to assist with the installations?
- Is there a product expert to talk to about any queries?
The more ‘yes’ answers there are, the better the value they will bring to the transport business. Another benefit of this is that employees can easily monitor the service delivery of the supplier and report on any deviation from their usual standards.
Should any supplier no longer provide a crucial product or service or start missing deadlines and agreements, it will be up to the logistics manager to find another that can. The process will start from scratch until the manager finds a replacement supplier. In larger businesses, the procurement department will play a key role in sourcing suppliers, monitoring performance, and setting up contracts and terms with potential and existing suppliers.
3. Set Up A Meeting With The Preferred Supplier
After careful consideration, you can make a short list of the suppliers you would like to discuss further details with. These discussions should include the detailed information you both need to seal the deal, like a service level agreement and price negotiations.
Suppose a company had other suppliers and already had a service level agreement outline. They can present this to the supplier and discuss how they can consolidate the requirements for both companies. Once everyone agrees and all documentation is in place, the company can sign the final, binding agreement with the supplier to commence the relationship.
4. Monitor And Assess The Service Delivery
Although this seems like something a company should do after appointing a supplier, they could also have a trial period to monitor and assess the products or services they receive from potential suppliers before entering a contract agreement.
It isn’t uncommon for larger businesses to ask for a probation period, especially if they have had many problems with suppliers and management of the fleet in the past. Of course, suppliers will want to impress you during this time and present themselves in the best light, so keep a close eye on their performance for any red flags before agreeing to use them on a more permanent basis.
To Conclude
Suppliers can make or break any business. Poor quality supplies will affect a transport business’s service level with their clients and thus their bottom line. When it comes to choosing which companies to partner with for your supply requirements, a wrong decision can affect your entire process. Be prudent!
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