Manage suppliers so they don't sink you
Your supplier sets your cost, your quality, and whether you can ship at all. Running on one unvetted vendor and a handshake is an existential risk.
The fix: sample before committing, agree terms in writing, score performance, and have a backup. AI can draft the checklist, the terms to nail down, and a scorecard; you make the judgment and relationship calls.
Fastest path: one prompt, end to end
🤖 AI prompt — paste into ChatGPT / Claude
You are a sourcing advisor for a DTC brand.
Product: [what it is] Current supplier situation: [one vendor / several / none yet]
My priorities in order: [e.g. quality, cost, lead time, MOQ, ethics]
Do this:
1. Give a supplier vetting checklist before I commit: samples to request, questions to ask, red flags (no samples, evasive on defects, one-size pricing).
2. List the exact terms to agree IN WRITING: unit price at volume tiers, MOQ, lead time, payment terms, defect/return handling, who owns tooling/molds.
3. Give a simple monthly scorecard (on-time %, defect %, responsiveness) so I can compare vendors and justify switching.
4. Recommend how and when to line up a backup supplier before I need one.
Don't invent prices or vendor names; keep it a framework I fill in.
Output: vetting checklist + terms list + scorecard + backup plan.
Or do it in 4 steps
- Sample before you commit. Order and inspect real samples (ideally from 2-3 vendors) before any bulk order. A supplier who won't send samples, or whose sample differs from the pitch, is telling you something. Listen.
- Put terms in writing. Unit price at each volume tier, minimum order quantity, lead time, payment terms, and how defects and shortages are handled. A handshake price becomes a surprise invoice; written terms are your only leverage when something slips.
- Score performance monthly. Track on-time delivery %, defect rate, and responsiveness. A scorecard turns "they feel unreliable" into evidence, and tells you when to renegotiate or switch.
- Always have a backup lined up. Single-sourcing is the risk that ends stores: one factory delay or price hike and you can't ship. Qualify a second supplier before you're desperate, even if you buy little from them, so a switch is days, not months.
Worked example (labeled): a brand on one overseas vendor hits a 6-week delay at peak season and stocks out through Q4, its worst outcome of the year.
A brand that had qualified a backup shifts a rush order there at a higher unit cost but keeps selling. The premium on the backup order is trivial next to a quarter of lost sales. That's what single-sourcing actually costs.
Re-score suppliers monthly; re-sample and re-quote at least yearly, and keep the backup warm.