Suppliers and contractors are susceptible to financial stress, particularly during times of economic downturns or through poor management decisions. If suppliers become insolvent and can no longer operate, this can have a significant effect on their customers.
If one of your major suppliers becomes insolvent, this may have a disastrous affect on your business, and may prevent your business from operating. Checking the financial health of your suppliers during the initial tender process, and then regularly during the contract term manages this risk. Businesses have time to take action if a major supplier is showing signs of becoming financially stressed, before it’s too late.