As an organization, the reputation of your business is imperative to getting recognition in the fast-paced business world. To reach the highest point of development, a business must outsource some of its tasks to third party suppliers and vendors. Companies depend on vendors to provide products as well as services required to keep the business up and running. A business could work with any number of vendors it wants, from one to tens or even hundreds of them.
Making Sure that You Are Working with the Right Vendor
Types of vendors include companies that provide parts and materials, service providers (cleaning services, for instance), office items suppliers, and equipment manufacturers. With surplus stock, liquidation, and overstock sales generally happening in minutes, businesses have to act fast and take advantage of the amazing offers they get from their vendors. There are probably dozens of other businesses looking to make a killing with the same wholesale bargain deal. But in the wake of high levels of corporate fraud, such a deal could as well be a scam. How do you ascertain the authenticity of your vendors and third-party suppliers? Here are 4 helpful ways of ensuring that your vendors are exactly who they say they are.
Ensure that the business keeps a managed vendor list. You may be putting your company in jeopardy if you don’t have a vendor screening procedure or process in place. Set aside an employee or several to manage the influx of incoming calls from the growing number of vendors that want to work with the business. An effectively managed list of vendors ensures that all processes between order and payment go smoothly and reduces the spending. On top of that, managing your list of vendors makes the vendor screening process much easier. Proper vendor screening procedures will help your business stay on top of suspected cases of vendor-related fraud.
The Devil Is in the Details
It may seem like a very simple task, but asking for the vendor’s full details — that is the company registration number, a copy of their tax ID, and VAT — can be really helpful in establishing their legitimacy. Depending on who you are dealing with, Google could end up being a very helpful research tool. It’s much easier when dealing with a company as opposed to an individual. Information isn’t so easy to come by.
Watch out for the Overly Good Deals
If you are dealing with US vendors, websites such as the Better Business Bureau (BBB) can be quite helpful. Office of Fair Trading (OFT) is the United Kingdom’s equivalent of BBB; you can check it out if you are dealing with a UK-based vendor/third party supplier.If it sounds too good to be true, take note. One of the most common lure tactics scammers use is unbeatable prices. But you will never get the promised products, so the price doesn’t even matter. Watch out for these types of deals and stay away from such vendors.
Ask for Customer Referrals
All legitimate vendors out there know and understand the power and value of customer referrals. Therefore, before finalizing the deal, ask for several referrals. If they are actually who they say they are, you will be provided with the names as well as the contact info of several satisfied buyers. Give them a call.
Vendor verification, as well as due diligence processes, can add great value to your business. You will be able to ascertain the authenticity of your vendors easily and avoid falling victim to vendor scam. You will also shield your business from transaction risks and at the same time save time and money while doing it.