5 Best Practices For Buying Bulk Oil Manufacturing Ingredients

Posted by Hannah Broaddus

5 Best Practices For Buying Bulk Oil Manufacturing IngredientsIf your job is to place orders and plan inventory for your raw ingredients, you’ve got a lot of information to juggle at one time. Your most important job is to make sure that the raw ingredients your company needs for production get there on time, so that you manufacturing can go off as planned, without a hitch.

Here’s 5 best practices to keep in mind when you’re placing orders. These tips will help you save money, will help your oil deliver on time and should make your job as simple as possible.

1. Plan When To Order Using Realistic Lead & Ship Timelines

Find out the realistic lead times for your supplier, and make sure you take into account both the time that it takes to go through production and the time that it takes to ship from your suppliers location to your own. Plan ahead, so that you can place orders far enough in advance to work within these lead times.

If it’s not possible for your company to plan in advance, you may be better off working with a local distributor. You may end up spending more money in the long run, but local distributors will often work with smaller volumes and have shorter lead times. In addition, they can often accommodate pick-ups if you’re in a real pinch.

2. Order Full Pallets

Don’t pay too much on shipping. Always order a full pallet of whatever size that you decide to go with. Even if you end up sitting on some of the inventory for a little bit, it is still worth the savings you will see on shipping.

For example, if you order 1 drum, the shipping will often be the same or just slightly less than if you ordered a full pallet of 4 drums. Whether the shipping rate is weight-based or if it’s a flat pallet price, you will always save by shipping a full pallet. Determine the per pound shipping cost to get a real comparison.

3. Find Out Where The Volume Discount Price Break Points Are

Most ingredient suppliers have bracketed pricing, which means the more you buy, the more you save. Find out where those price breaks are to get the extra savings. You may find that by ordering just a little bit more(and placing orders less often), you can decrease your overall costs by quite a bit.

4. List A Delivery/Required-By Date On Your Order

Putting a realistic required by date on your order will help your supplier plan accordingly. They will always process your orders ASAP, but sometimes the written date can help them plan their production better.

Also, you can place orders far in advance by indicating delivery dates that are weeks or months out. For example, you could place 6 orders at the beginning of the year, with delivery dates staggered months into the future. The advantage to this is that your order will have priority because it was received first-- the oil will be reserved for you and you shouldn’t be subject to occasional oil shortages or delays.

5. Request Tracking Information Once Your Order Ships

It’s always nice to be in the loop. Once your order ships, you should be able to know where it is along the way so that you can find out if there are any hold ups. Your supplier should provide you the PRO number (a tracking number) and the company that your freight shipped with, so you can track your order online.

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Topics: Food Manufacturing



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