Your supply chain is one of the most important assets a business can have.  The relationships between a contractor/reseller and their vendors ultimately determines how much profit can be earned regardless of the sales channel, so understanding and managing those relationships is critical.

Having a GSA contract is an amazing opportunity, and unfortunately it is surprisingly common for a contractor to be granted a GSA Contract, then once that contract has been negotiated and prices have been set, the contractor realizes they are losing money on many of the orders that are received.  Hundreds of GSA contractors every year cancel their Contract as it becomes apparent that they can’t effectively compete in the marketplace.

There is still an opportunity to correct this situation and prevent those losses; by expanding the vendor supply chain a company creates options, possibly better pricing, improved shipping rates, as well as suppliers who offer a wider range of products which in turn allows the Contractor to add them to their contract.

There are a variety of elements that are important in a good supplier:

-Product pricing- naturally this is one of the most important factors in selecting a supplier, but not the only one.
-Shipping rates and programs– some suppliers have excellent shipping programs that end up making their supply cheaper overall as shipping is the second largest component of your cost.
-Volume discounts – a supplier that offers a volume or large order discount or even free freight on some orders can drastically improve the profitability on large orders.
-Drop ship options – some suppliers offer the ability to drop ship orders directly from the manufacturer, this can lower the cost as well as reduce delivery time.
-Delivery time – quick delivery is important in government sales, so its important to know how quickly the vendor processes orders and how many warehouses they have.
-Terms and payment options – some vendors offer a discount for fast payment; since most government customers pay via credit card there can be substantial savings paying bills early.
-Manufacturer authorizations – it is important that the manufacturer supports the contractors’ sales initiatives. Some suppliers are not directly authorized to sell the products they offer, and this can create issues with GSA on the contract items.

GovDirector has developed relationships with many major suppliers and manufacturers across multiple product verticals.  Our team is here to assist our clients in improving their supply channel and expand their contract product offerings, while also improving their bottom line all at the same time.

Contact our team today and see how we can help you.