Question

Discuss a situation in which a purchaser might select a supplier that is having financial difficulties.

Answer 1

When we have a supplier with financial difficulties but can provide the material with perfect quality required for us in the required time or when they are the only option available , a purchaser will select the supplier even when they know they have financial difficulties. For example we need material as early as possible because our regular supplier is facing some issues with their supply chain and cannot produce the material . We need the material to manufacture the products and we need to send the order to the customer. In this situation we search for other suppliers. If we have two options where one supplier cannot produce the material before the required time but is a well known supplier and the other is a supplier in financial difficulties but can produce the material within the time period and with good quality. We go for the second supplier because we need the material and if we offer them some help like transport they can produce the material required by us.