Interview the candidates to make certain they fully understand your requirements and that you understand their proposed approach to completing the project. Resist the temptation to accept the lowest bid even when you feel uncomfortable with that supplier. If the low bidder truly seems to be the best supplier, then by all means feel comfortable with going that direction. Look for the best qualified supplier. Know When To Take Advantage of Suppliers' Promotions One of the easiest ways to tie up cash unnecessarily is to overload your warehouse or shelves with inventory.
Suppliers selling product at a great price make it tempting to load up on certain products.
But you should avoid buying product just because the price is right unless you know you can move it within a reasonable time frame. Remember that there is a carrying cost associated with the inventory that sits in your warehouse or on your shelves. If you can realize increased gross profit that will more than offset the carrying cost of the additional inventory, it could make sense to buy more inventory at the reduced prices. That means that you actually sell the product. Let's look at an example.