Social distancing and shelter-in-place ordinances during the COVID-19 crisis have caused many small businesses to close their doors or shift to online sales. Unfortunately, some criminals are exploiting the situation to defraud customers and business owners with gouging or grey market activity.
Regardless of your industry, it’s imperative to be judicious in how you order supplies, compare pricing and vet your products. When looking for cost-effective ways to procure goods online, a little vigilance goes a long way to ensure quality, value-driven purchases. Here are some more best practices to avoid time-consuming miscues and to ensure a secure and quality online supply chain:
One of the most important aspects of supply chain management is ensuring you’re purchasing from trusted sites and sellers. Consider how much detail is provided about the product and what information your purchasing platform or distributor can share regarding its source. Don’t be afraid to ask questions about the origin of products.
Whenever possible, secure products and supplies from the original manufacturer or from a recognized distributor you know and trust. Items that are inadvertently purchased off the grey market (resold to you by someone other than the original manufacturer or a recognized distributor) can introduce legal and financial risk, especially in closely regulated fields.
The grey market is a supply channel that is unofficial, unauthorized or unintended by the original manufacturer. Difficult-to-obtain supplies can show up on the market at a 50x markup or in slightly modified packaging. Even for legitimate items, price gouging has been rampant during the Coronavirus pandemic, so be extra mindful of the products you’re buying and from whom.
The Value Equation
Value is defined by cost divided by quality, which means your supply chain will be stronger if you’re not just shopping for the lowest-cost products but instead those that are most cost-effective—ones that perform well without breaking the bank. When you’re thinking about cost, don’t forget to factor in the time you spend shopping, too. Maybe that means choosing platforms that are transparent and show pricing upfront, saving you time.
Staying on Trend
Along the lines of the value equation, think about how your supply chain can align with your longer-term business goals, even if these are on pause at the moment. Perhaps this is a time to think through new products or consumer trends you could capitalize on when businesses open back up. E-commerce platforms that curate eco-friendly or sustainable materials, for example, save you the time of researching new sellers as you aim to align with customer interests.
Look for an e-commerce platform that is tailored to your industry so that its inventory and product information are geared to your needs. For example, are reimbursement details required for you, or tax-exempt purchasing? Can your buying platform offer this information conveniently? Ideally, the platform is backed by a trusted partner and evolves its products and user interface to meet users’ needs. At Premier Inc., we’ve seen this model work well within our e-commerce marketplace.
A well-structured supply chain functions efficiently and adds value. It propels purchasing from an isolated, transactional activity to a strategic function of your business. It can drive growth or stability—especially during these times. And part of ensuring a tight, safe supply chain is aligning yourself with the right platforms, partners and products.
This article was adapted from an earlier version https://amex.co/34DVe1W
This article is intended for general informational purposes only and does not constitute legal advice or an opinion on any issue. It should not be regarded as comprehensive or a substitute for professional advice.