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8 Questions to Ask a Steel Supplier

Imagine waiting for your steel supplier to deliver your order only to find it does not meet your specifications. This is can be frustrating, especially when your customers are waiting for supplies.

However, as bad as this situation is, it may be inevitable if you don’t know the right questions to ask before you settle on a steel supplier.

Here are eight questions you should ask a steel supplier before you decide to do business with them:

1. Are the Payment Terms Negotiable?

It is important to ask a steel supplier if their payment terms are negotiable. As a vendor, working with a supplier who gives you an opportunity to negotiate on payment terms is crucial. Payments for invoices are often due within 30 days. However, you can negotiate with the supplier to extend payment terms for up to 90 days.

2. What Will Be the Total Cost of the Order?

Sometimes, a supplier may not include the total cost of a product in the quotation. As a result, you end up paying more for the product than you had budgeted for. Such costs include delivery fees, fuel charges and restocking fees in case of product returns. Let the supplier take you through the contract and show you all the costs that add up to your total cost.

3. Will the Supplier Give You a Liability Insurance Certificate?

A good steel supplier should provide you with a liability insurance certificate. It protects you in case the entire or part of your consignment is lost or damaged before reaching you. Always ask the supplier for a new copy of a liability insurance certificate every year to confirm policy renewal.

4. Do They Sell Their Product Directly to Consumers?

Ask if the supplier sells directly to consumers if you want to distribute to end-users. If they do, find out at what price they sell to decide if it’s competitive. Additionally, ask if they have intentions of cutting off their distributors once they are established in the market.

5. What Happens If the Order Fails to Arrive on Time?

In case an order arrives late, find out if the supplier will compensate for the inconvenience. Enquire if the supplier gives discounts for goods that arrive late. Will they reimburse you in case you buy the items elsewhere due to late delivery? You may have to do this to avoid inconveniencing your loyal customers.

6. Under What Circumstances Do Their Prices Change?

Find out the supplier’s determinants to price change. Will the products price change due to inflation or the industry index? Moreover, how much time will it take to notify you in case the price increases? Also, in case the supplier reduces or lowers their prices, will you be required to lower yours as well?

7. Does the Steel Supplier Offer Discounts?

It is important to ask if the supplier gives discounts on bulk purchases. It helps to plan your orders to take advantage of the discounts. Additionally, you will be able to choose the most competitive steel supplier to work with.

8. At What Point Is the Product Ownership Transferred to You?

Ask if the product will be transferred to you upon delivery or after a certain duration.  Whatever answer you get will determine if you will have enough time to inspect the goods once delivered. This will give you an opportunity to ensure they meet your specifications. Essentially, ask for the inclusion of inspection and delivery clauses in the contract to give you three to five days to check if the delivered product is exactly what you ordered before ownership transfers to you.

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