Suppliers You Have Not Reviewed

Make the list before making judgements

The useful annual exercise is not deciding which supplier to replace; it is knowing who you depend on at all.

Most small businesses have never written that list, so the question of exposure has never been asked.

It is longer than people expect, because it includes everything with a login as well as everything that sends an invoice.

Half an hour with a blank page produces something genuinely useful and slightly alarming.

What belongs on it

• Goods and materials suppliers.
• Hosting, domain, and email.
• The accounting and payment systems.
• Subcontractors you rely on.
• Whoever built and maintains the site.
• The bank and the insurer.

The fourth is the one most often missing. A trades business depending on one subcontractor for a particular skill has a dependency as real as any supplier, and considerably less formalised.

Mark each one for replaceability

Which is the whole of the analysis.

Replaceable in a day: several alternatives, no switching cost, nothing locked in.

Replaceable in a month: an alternative exists and moving takes work.

Not replaceable: no alternative, or the switching cost is prohibitive, or you hold no copy of what they hold.

The first category needs no attention, the second needs an alternative identified, and the third is the actual risk register.

For most small businesses the third category has between one and three entries, which makes it a manageable problem once it is visible.

A worked example

A business listed nineteen dependencies.

Fourteen were replaceable in a day, three in a month, and two were not.

The two were a single subcontractor holding a certification nobody else in the area had, and the person who built the site, who held the only copy of the source files.

The second was solved in an afternoon by requesting a copy of everything.

The first could not be solved, and knowing about it changed how they scheduled work and how they treated that relationship.

The list took forty minutes and produced two genuinely useful actions.

Ask what each one holds

Which is the question that turns a dependency into a risk.

Your customer data, your files, your domain, your accounts, your history.

A supplier who holds something you have no copy of is a different proposition from one who simply provides a service.

For each of those, ask whether you could get it back today, in a form you could use, without their cooperation.

Where the answer is no, that is a job for January regardless of how good the relationship is.

Relationships end for reasons that have nothing to do with either party.

Check the ones that have quietly grown

Which is the other thing a year produces.

A supplier taken on for one thing frequently ends up doing four, none of which was ever agreed properly.

Look at what you actually paid each one this year against what you thought you were buying.

That comparison finds the relationships that have drifted, in either direction, and it is a better conversation starter than a general review.

It also finds the ones where you are paying for something you stopped using.

A year of invoices tells you this in twenty minutes.

Name a second option for the middle category

Which is cheap insurance.

For everything replaceable in a month, note who the alternative would be, before you need one.

That is a name and a number written down, not a conversation or a quotation.

The value is that a supplier failing in March becomes a phone call rather than a week of research at the worst possible moment.

Ten minutes of that across three suppliers is the highest-return item on this list.

Ask about their December

Which is timely and frequently overlooked.

Find out when each critical supplier closes and reopens, and whether anything you might need in the first week of January requires ordering now.

A business reopening on the second with materials arriving on the tenth has a wasted week it could have avoided with one email in December.

Ask now rather than discovering it, since the person who could answer is about to be away.

Write the dates down beside each supplier on the list you have just made.

Write down who to call at each one

Which is the detail that makes the list usable rather than merely informative.

A supplier name is not much help at eight in the morning when something has gone wrong and the person who normally deals with them is away.

Beside each entry, note the account number, the contact name, the direct number, and the email address that actually gets answered.

That turns a risk register into an operations document, which is a considerably more useful thing to have in a drawer.

It is also the document somebody needs if you are ill, which is the scenario nobody plans for and everybody eventually meets.

The counter-case

Dependency is not the same as danger.

A long relationship with a reliable supplier is an asset, and treating it as a risk to be diversified away can cost you the terms and the goodwill that came with it.

Most suppliers also do not disappear, and preparing extensively for something that rarely happens is its own cost.

And a very small business may genuinely have only three dependencies, in which case this is a ten-minute exercise rather than an afternoon.

It is still worth writing down, since the list is what you hand to somebody else in an emergency.

Ten minutes now against an hour of guessing later.

List every dependency, mark each replaceable in a day, a month, or not at all, name alternatives for the middle group, and get copies of what others hold.

What to do

1. List every dependency.
2. Include logins, not just invoices.
3. Mark each for replaceability.
4. Ask what each one holds.
5. Get copies of anything you lack.
6. Name a second option.
7. Note their holiday dates.

Step four is where the real exposure sits, since a supplier who holds files or data you have no copy of can end a relationship and take part of your business with them.

The replacement decision is covered in the supplier you should replace.

Frequently asked questions

West Coast Media Solutions Inc. provides web design, web development, hosting, digital marketing, and business consulting to organisations across Canada, drawing on more than twenty-five years in the field.