Navigating Supply Chain Risks: How Secondary Suppliers Keep Your Business Running

Written by Valutek | April 6, 2023

Products that are critical to cleanroom operations merit a secondary source that serves as a backup to your primary. You may have a reliable primary supplier who is rarely out of stock, but disruptions to raw material supply, labor shortages, and logistics problems can happen at any time.

If you have taken the time to qualify a secondary manufacturer for your supply of critical products, you have taken an essential first step to ensure business continuity.

[ Part III - Business Continuity: Secondary Supplier Series]

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Developing a Relationship With Your Secondary Source

Any quality manufacturer will allocate inventory to its current customers first, before supplying to new customers. Turning to your qualified secondary manufacturer only when the emergency happens may seem like a good strategy, but if you haven’t developed a relationship or established buying patterns after qualification, there won’t be inventory allocated to fulfill your order.

Manufacturers set production levels based on historical usage and when inventory is tight, they will fulfill orders to customers that have an established order history and forecast. Thus, it makes sense to set expectations with your secondary source about your order volume and frequency.

Give your secondary supplier part of your total allocation to begin to develop a relationship. You might consider moving over 40% of your total spend to the secondary and keeping 60% with your primary.
Conduct annual business reviews with both your primary and secondary manufacturers —the more information you can provide, the better support they can offer.
Conduct annual business reviews with both your primary and secondary manufacturers.
Ensure your distributor is required to provide only qualified material that you have approved.

While sole sourcing and consolidating your entire spending might initially appear more convenient and have minor cost savings, having a redundant supply of critical products creates a stronger qualified manufacturer ecosystem, which is a key component of a business continuity plan.

Learn more about recommended practices for sourcing critical products and the risk factors you need to mitigate.

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