Every day, business owners and managers have to make decisions. It comes with the territory.These decisions can be anything from buying a large piece of new equipment to speed up production, hiring two sales people to help increase turnover or switching to a new component supplier to reduce costs by 15%.
However, while businesses are likely to do in-depth research on new equipment and nearly always carry out proper job interviews, only around half will do thorough checks on their suppliers. The promise of a 15% reduction in costs could be pie in the sky if that supplier fails to deliver the goods.
Here are seven important reasons why it makes good sense to check on suppliers and customers using business intelligence from Qynn...
Waiting over 30 days to be paid by a customer is one of the most common and most frustrating problems in modern business. According to the business lender Liberis, UK small businesses were chasing £14.9 billion in late payments in April 2018 – up £1 billion on the previous six months. Liberis’ research also showed that 58% of small businesses were owed up to £10,000 and 25% were waiting on over £20,000.
Pursuing payments has an effect on a whole range of other business decisions. It inhibits the ordering of stock and hiring of staff. Often there is a knock-on effect – businesses that are owed money can’t pay their suppliers, and the sorry cycle continues. Late payments by customers leads to extended borrowing, which in turn increases the overall cost of doing business.
Likewise, supplier checks will help a company ensure that the materials and components it needs arrive on time and in the right quantities. Using Qynn, for example, it’s easy to check on a supplier’s cash at bank for its last set of accounts, as well as its levels of assets and liabilities. If a potential supplier doesn’t have much money in the bank, and has a large amount of debt, this could be a red light worth heeding.
Most companies rely on external service providers for a whole range of daily requirements. IT, telecoms and software are just the beginning. Relying on a software provider for bespoke tools can be risky if that supplier is in poor financial condition, and the loss of software and IT support can cripple a business of any size for days or weeks. Again, running some basic checks on Qynn into the financial health of a supplier often saves time and money in the long run.
When a supplier lets a company down, that business will try to pull out all the stops to keep its own customers satisfied. This could mean hours spent searching the Internet for alternative suppliers, further hours on the phone negotiating on price and setting up contracts. One alternative is to deal with suppliers on a one-off basis for each order, but this gets even more time consuming. It may be far easier and cheaper to carry out financial checks on suppliers and create a list of preferred partners rather than hiring buyers or adding the responsibility to a staff member’s job description.
At least finding new suppliers feels like a constructive endeavour and can reveal new opportunities. Conversely, chasing payments is frequently stressful and demoralising. Whether the late payment is down to sloppiness or the fact that the company owing the money is in financial difficulties, it drags business owners and managers into email and telephone conversations that could be vital to the survival of the business, but that also keep them from their normal roles. According to the Liberis survey, UK small businesses spend three days a month chasing payments. Ultimately, it’s a drain on management time, reducing productivity and efficiency.
Trust is such an important part of business, and Qynn’s data provides companies with the transparency needed to build trusting relationships with clients and suppliers. The platform quickly enables users to search for a company, discover who its directors are and see which other companies those people are involved with. Does a supplier also own one of your direct competitors? If so, is that supplier offering the best price or is it bleeding you out? Perhaps a supplier has directors with a string of bankruptcies behind them. It’s better to know this and perhaps find out why before deciding on whether to place a £2 million order with them.
Carrying out good due diligence on customers and suppliers will help a company to be seen as a trusted link in the supply chain within a sector. Increasingly, major buyers seek efficiencies by streamlining their supply chains. Companies that are frequently late with their orders and/or payments, for whatever reason, will fall off their lists of preferred partners. By running checks on suppliers and customers, the risk factor within your own organisation is reduced and, from a supply chain perspective, your reputation can only be enhanced. It’s another reason why using the business intelligence offered by Qynn makes sense in the global business environment.
And the good thing about Qynn is that it makes spreadsheets a thing of the past. Individual company and sector data can be viewed in a variety of customisable formats in order to easily analyse the performance of potential partners, customers or suppliers. The data for over five million UK companies is there at your fingertips.