How to choose a supplier of additives or ingredients? Part 2
In the previous article, how to choose a supplier of additives and ingredients? Part 1, we reviewed the first seven factors that must be taken into account when evaluating and selecting a supplier of additives or ingredients for food, nutraceutical, personal care or animal nutrition products. Next, we will see seven new points that should not be forgotten when making such an important decision for your company.
8. Logistics: Speed & Punctuality
Time is a fundamental factor in any B2B purchase decision, so it is convenient to work with suppliers that meet scheduled deliveries, even if that means paying a little more for our product.
For this reason, it is important to have suppliers that can fulfill its commitments in relation to delivery times and punctuality. A supplier that does not meet its delivery deadlines can cause significant losses to its client, having in some cases to stop production while waiting for the arrival of the product in question.
On the other hand, the different distribution channels offered by each supplier are an important factor when making the purchase decision, since depending on the rush that the client has, this may tip the balance for one option or the other.
It is also necessary to take into account everything related to the different Incoterms with which each supplier works, since this can translate into large differences both in the price of the product and in the risk associated with the transport of goods.
9. Origin: Natural or Synthetic?
Today, consumers are increasingly looking for products with ingredients of natural origin, which are healthier, safer and with transparent labeling. This reality has led manufacturers of these products to prefer suppliers that manufacture additives and ingredients that follow this trend.
Additives and ingredients for food, personal care and animal nutrition, are under constant review by the health authorities, so when choosing a certain supplier, it must be taken into account which products are less likely to see their use limited or suspended in the future. Making the wrong decision can cause huge problems for the buyer in the medium or long term.
An example of this is what happened with Ethoxyquin, a synthetic antioxidant, which in June 2017 was suspended by the European health authorities for its use as feed additive for all species and animal categories. This has meant that large industries, such as fishmeal, have had to search for effective and long-term alternatives to this problem.
10. Product shelf life
As expected, not all suppliers offer the same shelf life for the same type of product, so we cannot avoid considering this factor when choosing the additive or ingredient that we are going to buy.
It is not uncommon to find almost identical products, but with very different expiration dates, which can sometimes explain the large price differences between one product and another.
In addition, if we buy an ingredient to add it in the production process of a product that we want to have a certain shelf life (e.g. 18 months), the shelf life of that specific ingredient should not be less than that.
For the buyer, it is necessary to know the product in which the additives or ingredients are going to be added and its production process, since depending on this, a product in one format or another may be required. For example, there are applications in which it is convenient to use a product in liquid format and others in which it is preferable to use it in powder format.
It is important to know if a supplier offers the product in different formats for specific uses, otherwise additional costs may be incurred to change the condition of a product (e.g. from liquid to powder). In addition, depending on the format, there may be important differences regarding the optimal dosage or the phase of the production process in which the product should be added.
Different types of packaging and their size may be a relevant issue for some companies when making the purchase decision. There are companies that require a small quantity of a product, so it doesn’t make much sense to buy the product in large formats such as a drum or an IBC. On the contrary, companies that consume large quantities of the product will probably prefer a large container to a small one such as 1 kg bags or bottles.
It is not uncommon to see that there are inflexible supplier companies in this aspect of the business, offering only one or two types of packaging, forcing their clients to adapt or to look for other alternatives. Instead, there are suppliers who always put their clients first and offer them a wide range of possibilities in terms of packaging, even if this means a small additional cost for the supplier itself.
In food, nutraceutical, personal care or animal nutrition, it is very important to have suppliers that can certify the traceability of their raw materials. This is because in the event of any health problem related to our product, it could be detected at what stage of the process it has been caused and act accordingly. Knowing the traceability of additives and ingredients allows us to know the path that a certain product has followed from its manufacture to its consumption, and to know where and how it has been produced. Many certifications, such as the Non-GMO certificate or the RSPO, are based on guaranteeing such traceability.
If you want to know more about the different certificates in the food industry, click here.
14. ‘Country Brand’
It is no secret to anyone that in the additives and ingredients market there are countries with a better reputation than others when it comes to manufacturing ingredients and doing business. This last point refers to the trust, seriousness and credibility provided by a specific country in relation to its industrial, social and economic development. It is very important to highlight the geographical origin of the products to be purchased, as this can have an effect on the quality of the final product and on the expected results.
As we can see, when choosing a supplier of raw materials for our company, there are many elements that must be considered to get the decision right. And although the price of products is, apparently, the easiest way to compare the different alternatives that we have, there are many other aspects that must be part of the equation.
On the other hand, it should not be forgotten that trust is essential for a good client-supplier relationship, so it is important to work with companies who transmit this trust to us, either because we have worked satisfactorily with them previously, because they are experts in products they offer or because they have the necessary certifications.
Finally, there are also other factors, such as payment conditions, that we have not mentioned in this article. However, they are not less important and they should also be taken into account.
Photo credit: Elevate (Unsplash)