Welcome back to our supply inefficiency video series. Today, let’s explore the cost of buying direct.
It might seem better to purchase inventory directly from the manufacturer or supplier, but the cost of doing so includes more than just the purchase price.
Depending on how many different suppliers you’d need to work with, costs associated with transportation, procurement and production may add up fast.
In addition to these costs, if you are buying direct, you may not be entitled to the discounts or quick lead times that are available to a distributor who works more frequently with that supplier.
Imagine if you were able to condense all of your purchases into one. Not only would there be fewer deliveries to deal with and less time spent purchasing and stocking inventory, but everything you need would arrive together.
Consolidation also means more buying power, which puts you in a better position for negotiation as well as moving you up the priority list, when needed.
In our next episode, we’ll discuss supply inefficiency number four, freight, so come back to Falcon Fastening soon.
Falcon’s Reliable Stock™ lean VMI program delivers 100% production uptime efficiency and reduces your lead times, while lowering your overall inventory investment in class C production components and fastening supplies. Talk to us today and find out how you could be saving time and money.
Michelle is the Marketing Manager at Falcon Fastening Solutions, Inc. She is focused in communicating value to Falcon's customers, contacts and audiences by sharing the company's unique approach to fastening and class C production component supply.
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SCMEP and Falcon Fastening Solutions are partnering to bring you Value Engineering Fundamentals. A 50% discount is offered to qualified attendees. SC manufacturers please call 864-288-5687 to find out if you qualify. If you are located outside of SC, please call 1-800-438-0332. Related Posts:10 Signs of a Good VMI Program March 31, 2014 How to Calculate Overall Equipment Effectiveness (OEE) March 4, 2015 How Vendor Consolidation Can Improve Inventory Management April 30, 2015 Read more →