The COVID-19 pandemic has forced the global economy to a screeching halt. As countries ban nonessential travel and business, industries of every kind are facing unprecedented challenges. This crisis is revealing just how impactful a disruption of this magnitude can be in a world that heavily relies on globalization to source and transport supplies and products. B2B buyers are already learning lessons to become better prepared for the next big disruption. They must diversify their supplier base so that future impacts to specific regions will not completely shut down their business.
Reduce Uncertainty with Geographic Mitigation
Basil M. Karatzas, CEO of Karatzas Marine Advisors & Co., recently told The Diplomat, “It’s becoming very clear for shipping and other firms that by outsourcing their production to just one country or manufacturer, they may be exposing themselves to high levels of uncertainty when any part of the supply and logistical chain goes wrong.”
B2B buyers can reduce uncertainty and ensure their business survives economic instability with geographic mitigation. Rather than relying on a single supplier or multiple suppliers in one geographic area, buyers should establish relationships with a variety of suppliers in various parts of the world. Business buyers should work with suppliers in their local market and in multiple countries to mitigate the risk of interruptions. Put simply, B2B buyers should not put all of their eggs in one basket. Here’s how.
3 Ways Business Buyers Can Diversify their Supplier Base
#1 – Join a B2B Marketplace
Marketplaces are online platforms, such as TradeLeaves Marketplace, where products, materials, and information are provided by members from around the world. B2B buyers are granted access to countless top-tier suppliers who have been properly vetted. Business buyers can initiate product or material inquiries, request quotes, communicate with suppliers, obtain samples, and conduct secure transactions all within TradeLeaves Marketplace.
#2 – Rely on B2B eCommerce Sites
Consumers turn to online retailers to gain access to hundreds of options for any particular kind of product. B2B buyers can leverage the same benefits of choice for their B2B transactions on eCommerce sites that are set up exclusively for that purpose. TradeLeaves Classifieds allows buyers to view product offerings and make purchases from sellers far and wide. TradeLeaves Classifieds gives buyers a place to turn when a particular procurement need cannot be met elsewhere. It also gives buyers an opportunity to test the waters with potential suppliers. After several successful transactions with a seller, a B2B buyer could add that proven supplier to their supplier base.
#3 – Explore Options Through Online Business Listings
Suppliers are increasingly relying on digital listing services to find buyers both domestically and internationally. Buyers can explore options in specific geographic areas and make purchase inquiries through a listing service like TradeLeaves BLISS. Buyers can read company profiles, examine credentials, and engage in communications with verified suppliers simply and easily in TradeLeaves BLISS.
Concerns to Address when Evaluating Suppliers
B2B buyers know they have to diversify their supplier base in order to mitigate risk against future disruptions. How can a buyer make sure they enter into relationships with the right suppliers? When a B2B buyer is evaluating new suppliers, they should consider the following common concerns.
- Does the supplier understand the buyer’s business? In order to provide solutions, they must understand how the business makes money.
- Is the supplier an expert with breadth and depth of understanding in the field?
- What resources, consultations, education, and tools does the supplier offer to support the business buyer?
- Is the supplier responsive to the buyer’s needs, communications, and questions?
- Has the supplier been verified within the marketplace? Can the supplier provide assurances related to product quality, delivery, timeline, and fulfillment?
The COVID-19 pandemic will have far reaching consequences for every industry across the entire globe. As a business buyer, now is the time to take steps that will stabilize your supply chain and better prepare you for the future. TradeLeaves can help. Join our expanding worldwide community of B2B suppliers and buyers free of charge today.