smaller supplier

The role of the smaller supplier in the supply chain

Many smaller suppliers may believe they are unable or unsuitable to meet the needs of well-established, blue-chip companies, however this is often not the case. While some small suppliers may lack some of the compliance standards required, they often have many other benefits including agility and innovation. In this article, we will explore why being smaller could actually be the reason why an organisation is chosen over others in a bid.

The benefits of a smaller supplier 

Smaller suppliers are often able to offer more flexibility and agility in adapting to a client's requirements. Instead of having to go through rigorous processes and bureaucratic loopholes to refine their solutions to meet the client’s requirements, they can quickly customise their offerings and provide personalised solutions. Equally, as there are often fewer stages in the chain of command, smaller suppliers are able to make decisions more quickly and respond promptly to client inquiries, requests, and changes. The responsiveness and bespoke approaches can be highly advantageous for blue-chip clients who require fast turnarounds and swift problem-solving.

Smaller suppliers are often driven by innovation and differentiation to compete with larger players in the market. They can bring fresh ideas, creative solutions, and niche expertise to the table, offering their clients a unique value proposition that larger suppliers may not always provide. This innovative approach can be appealing, particularly for clients seeking new perspectives and approaches to their business challenges. They can also often provide a higher level of personalised attention and customer service to their clients. They often have closer relationships with their customers, enabling them to understand their needs on a deeper level and offer a more tailored experience. With these benefits combined, buyers often value this level of innovation and individual attention that suppliers can offer.

Smaller suppliers often provide greater financial advantages to their clients. As they often want to keep a tighter control of their own profit margins and bottom line, smaller suppliers often also typically have lower overhead costs and are generally more cost-effective than larger competitors. They can offer competitive pricing, which may be attractive to blue-chip clients looking to optimise their expenses while maintaining quality. Equally, they are often more willing than a larger supplier to work on a low value contract. Given the need for their own tighter controls of processes and expenditure, the client is often valued higher as they possess a greater share of their turnover.

Smaller suppliers often view their relationships with blue-chip clients as long-term partnerships. They are invested in building strong collaborative relationships and are willing to go the extra mile to ensure client satisfaction. This partnership mindset can lead to an engaged and mutually beneficial working relationship.

Finally, smaller suppliers may specialise in niche markets or have unique expertise in specific areas. This could include particular technological or linguistic capabilities, service offerings or are servicing a particular geography. This specialisation can position them as industry leaders in their respective domains, making them an attractive choice for blue-chip clients.

Being smaller may give you the competitive edge

This shows that supplier sourcing is not only restricted to the larger players in the market. That being said, while many smaller suppliers do often have many of the above advantages, they may also face challenges such as limited resources, scalability constraints, and perceived risk due to their size. Equally, many may not have the necessary accreditation or compliance standards that larger organisations may possess. Fortunately, this is something that Maistro can support suppliers with, including benchmarking across sectors and advice and guidance on meeting due diligence criteria. Big doesn’t necessarily mean better, and the role of the small to medium enterprise is here to stay.

If you’d like to find out more about how Maistro can support your small to medium enterprise, get in touch today.


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