How safe is your supply chain? Even if a company works hard to maintain a high level of safety and quality, its reputation can suffer if suppliers and contractors are not equally cautious. Some issues may even result in expensive lawsuits and regulatory fines. Selecting the right companies to do business with can be a minefield. Contractors and suppliers also face difficulties, possibly being underbid by competitors that cut corners. This is where contractor qualification vendors step in to help.
Selecting the Right Contractor or Supplier
We often talk about the problems that arise when good people hang with the wrong crowd. The same is true in the business world. If your company does business with the wrong suppliers and contractors, scandal can follow.
Imagine the following scenarios:
- A supplier provides sub par materials or parts. This results in a defective product and subsequent safety hazards.
- Contract workers improperly dispose of toxic materials, resulting in environmental hazards for which your company is blamed.
- A contractor cuts corners on a job, defying safety regulation and sacrificing quality.
- A contractor uses subcontractors who are not properly certified or trained.
Hiring contractors involves risks, and selecting a trustworthy organization is of vital importance.
Proving Your Qualifications
The process can be taxing for contractors and suppliers looking for new business, as well. After all, they need to find organizations that are a good match. Then they have to prove their qualifications. Different organizations may require different submissions, increasing the work required.
To make matters worse, they constantly face the risk of losing out to competitors who can charge less because they skimp on safety and quality.
Contractor Qualification Vendors
You can think of contractor qualification vendors as a type of matchmaker. Although different organizations might use slightly different processes, it basically works like this:
- Vendors and suppliers submit their applications, which may include safety programs, enterprise risk management, standard OSHA key performance indicators and more.
- The organization vets the information and approves the applications that meet the standards.
- Hiring clients submit their requirements and receive information on qualifying vendors and suppliers.
For example, any deficiencies found during the review process are discussed with the supplier through a review and verification process. Contractors and suppliers will have an opportunity to correct deficiencies or supply more information to any of the qualifying organizations.
This type of service can benefit both of the parties involved. The hiring client has a simplified way of finding contractors and suppliers who satisfy all safety and regulatory requirements. The suppliers and contractors have a way to find new business, and they gain access to hiring clients that require certification through a contractor qualification vendor.
Examples of this type of vendor review service include ISNetworld, Avetta and BROWZ. Avetta recently merged with BROWZ, as did PEC and Veriforce.
Protect Your Supply Chain
A chain is only as strong as its weakest link. Companies must be diligent about vetting their suppliers and contractors, verifying compliance with all regulations. Companies should also endeavor to do business with contractors and suppliers that uphold their values. Contractor qualification vendors provide a streamlined way of accomplishing this.
Higginbotham can help your business manage risks - contact one of our risk management professionals today.