How to deal with the delayed delivery of suppliers?

By justchinait
 / 
January 8, 2021
 / 

If you have ever purchased from China, then you must know that it is normal for Chinese suppliers to delay delivery. When delivery is delayed, the supplier will always tell you a reason. Based on our 11 years of local procurement experience in China, we guarantee that most of the time the reasons that suppliers tell you are not the real reason for the delay in delivery. The supplier is afraid of you to blame, so he always composes some reasons to convince you that the delay in delivery is not his responsibility.

Therefore, as buyers, we should have the ability to analyze the reasons for supplier delays so that we can take corresponding countermeasures to make our purchases smoother.

First of all, we should consider our own reasons:

1. The delivery time is too short, and the order quantity exceeds the supplier’s production capacity. The supplier did not meet the delivery requirements from the purchase of raw materials to production and proposed delayed delivery.

Countermeasure: Since you are in a hurry to place an order, the buyer needs to do a good business assessment and make some inventory appropriately to prevent the supplier from delaying the delivery

2. Wrong supplier selection. Failure to strictly evaluate the supplier in accordance with the regulations, including the supplier’s capacity, technology, quality and delivery capability

Perform certification, etc., and discover the supplier’s problems when delivery delays occur.

3. The order quantity is small and the supplier is unwilling to cooperate and proposes to delay delivery.

Countermeasure: At this time, it is appropriate to give the supplier some profit, let it catch the goods first, and then consider changing to a new supplier. This requires signing a contract at the beginning, and deliberately delaying delivery can be deducted at 2% per day for the current batch of goods.

4.The payment terms are too strict or the payment cannot be made in time. The buyer’s failure to pay on time caused the supplier to delay production.

Countermeasures: There is no absolute fairness in business, but there must be corresponding fairness. Suppliers are most afraid of customers defaulting on a payment. As the saying goes, no profit without early. To tell the supplier that I paid on time, you produced as required and delivered on time

5. Communication and coordination: Temporary changes to design or specifications, and insufficient communication on new material specifications. The quality requirements are not clear. Inconsistent understanding of pictures and specifications.

Countermeasures: Confirm the details of the order, including colors, specifications, models, designs, samples, etc., before placing the order. If you propose to change the design after placing the order, you must have a document to the supplier, not just mention it in the chat. The supplier has been notified in the form of formal documents that the design needs to be changed, and communicated to determine the final delivery date.

The reasons for supplier delays in delivery are:

1. Production status

  •   The order received exceeds the capacity of the production capacity;
  •   The production capacity is full and the order cannot be placed into production;
  •   Because the order quantity is too small, the supplier combines several orders to produce;
  •   The production technology level cannot keep up with the needs;
  •   The high defect rate in the manufacturing process leads to the need for rework;
  •   The production plan is not properly arranged;
  •   Insufficient number of machines, sudden crashes, or poor accuracy;
  •   Insufficiency of mold fixtures;
  •   Unqualified product inspection at the time of shipment

2. Production management

  •   The source of materials is outsourced and the supply is unstable;
  •   Poor schedule management;
  •   The quality control system is not implemented;
  •   Estimated delivery time is wrong;
  •   Poor quality of raw materials;
  •   Insufficient capacity of outsourced factories;
  •   Low staff willing to work;
  •   Incorrect shipping documents;
  •   Quotation error;
  •   Suppliers lack a sense of responsibility.

The above are the most common reasons for supplier delays. In order to avoid delays in delivery caused by suppliers, purchasers must make a series of preparations in the early stage, including:

1. Prior management: Supplier evaluation is essential. Evaluate the supplier’s historical delivery performance, be familiar with the supplier’s production cycle, and determine the feasibility of the supplier’s response to the delivery date. In addition to requesting the supplier to reply to the shipment date, it must reply to the planned production date and production date in the factory for this order, and confirm whether the plan is implemented as planned before the planned production.

2. In-process management: After the start of production, the supplier is required to regularly feedback the plan implementation progress, and timely follow up and deal with abnormalities. For example, in the production link, the documentary needs to understand the situation of each link of the component production and processing and be able to know the actual production time of each link.

3. Post-event management: When there is a delay, communicate in time and propose short-term countermeasures to reduce the impact of delayed delivery. Pass fines and reports as long-term improvement measures. Use supplier performance evaluation as the basis for allocating orders. Eliminate suppliers who often delay delivery.

When there is a delay in delivery from a supplier, the buyer does not have to rush to divide responsibilities. The first task is to get the product and deal with it effectively to avoid greater losses. There are several treatment measures:

1. Communicate and coordinate with the supplier to understand the real reason for the supplier’s delay in delivery. Only by understanding the real reason can we find an effective way to deal with it.

2. If the delayed delivery is a technical problem of your own products, you can ask the company’s engineers and factories to assist the manufacturer to solve the problem as soon as possible and assist the supplier to reach the delivery date.

3. If the delivery delay is caused by some reasons from the supplier, the seriousness of the problem that caused the delivery delay should be analyzed and communicated and coordinated. Or you can get in touch with the higher-level leaders of the supplier to get a better solution.

4. When the supplier does not cooperate with the delivery, actively search for market prices and find new suppliers who are ready to replace.

In short, it is best to curb the possibility of supplier delays at the source and avoid later troubles. Don’t worry too much when something goes wrong. First discuss the solution with the supplier, usually at this time the supplier will also actively cooperate.

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