A few suppliers or random purchases?

Many companies rely on just a few suppliers/wholesalers within their line of business - for instance for office supplies, materials, or products for resale. Others do their purchases when needed from multiple random suppliers. There is no right or wrong. It all depends on your business’ needs and the way you prefer to run business.

That said, we recommend that you structure your purchases and choose suppliers so that you:

  • Don’t run out of materials or products crucial for your daily operations.
  • Know your delivery times and payment terms.
  • Pay the right price for your goods.
  • Can track your purchases for bookkeeping and check of budgets.
  • Can handle payments quick and easy.
  • Don’t spend too much time on tracing special offers - but instead...
  • Negotiate fixed discounts or other favorable terms for your goods once and for all.

What to consider when deciding for suppliers


Some businesses depend on their suppliers. If they don’t get goods from their wholesaler, they have no products to sell. Consider if and what purchases that are crucial for your operation and find a solid supplier you can rely on. Use your network.

What do you need to buy?

It may seem too obvious to mention this initial consideration. But try to map all your expected purchases, ranging from toilet paper over catering to mainframe servers. You will be surprised! Do yourself a favor and split in categories.

How much of your purchases can be handled by one supplier?

Depending on your line of business and your company’s specific needs, you will most likely be able to get most of your goods from a few suppliers. It comes with a few advantages: It’s easier for you to order and pay for goods, and you may be able to negotiate better or more flexible terms.

How will the terms (prices, delivery, and payment) affect your cash flow and daily operation?

As mentioned, you should always try to negotiate better terms. But initially you have to relate to the given terms when deciding on a supplier. For instance, short payment terms can eventually lead to cash shortage. Long delivery times can interfere with your daily operations - or at least it means that you have to pay extra attention to planning your purchases.

Do you need help with planning?

We have created templates for planning

Download the templates