Before the economic downturn, it used to be simple to find a Short Run Metal Stamping vendor. You send out an RFQ to several companies, receive pricing, check their quality system and make a decision. I’m sure in most cases that system worked out just fine. The vendor you picked probably supplied good parts, on time for a fair price. Unfortunately, that may not be good enough in today’s economy.

I’m sure everyone in the manufacturing sector knows of several companies that have recently gone out of business. Tough times have taken a toll on a lot of these companies. Some of these businesses were producing good parts, on time for a fair price. They just didn’t manage their finances well enough to get through a major recession. Too many were relying on financing to carry them from month to month and many did not build a management team that will be capable of running their company for the next 20 years. Regardless of the reason, they may not answer their phone in the future when you need parts.

The most important thing you can ask your current vendor is How is your financial health? i.e. have you down sized? Is your building and rent excessive for your employee count? Do you have a lot of debt service? Most importantly, do you have cash reserves to survive? And last but not least, do you have a management team in place that will run the company for the next 10 to 20 years or more?

Remember, most companies in business today make good parts on time for a fair price or they wouldn’t be here. But also remember, if they have not planned for this recession they may not be here tomorrow. Ask yourself, how it would affect your company if your current vendor didn’t make it.

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