Price the total landed cost
Unit price, tooling, packaging, inspection, freight, duty, insurance, payment terms and defect rate together form the number that matters. A supplier two percent cheaper per unit with a four percent defect rate is more expensive in every scenario.
Payment terms deserve particular attention because they determine how much working capital is locked in inventory while you grow.
Qualify before you commit
Factory audits, sample runs, capacity checks and reference calls with existing customers take weeks and save quarters. Ask what happens when volume triples and what the factory does when a shipment fails inspection.
Dual sourcing for the highest volume products protects revenue when one supplier has a bad quarter.
Build quality control into the schedule
Pre-production, during production and pre-shipment inspections are cheaper than a marketplace return spiral and the review damage that follows it.
Written specifications with tolerances, packaging drawings and labelling requirements remove the ambiguity that causes most disputes.
Key takeaways
- •Compare total landed cost, not unit price.
- •Audit, sample and reference check before large orders.
- •Inspect at three stages and specify in writing.
Want this reviewed against your own account? Request a growth assessment.