Companies that fail to actively monitor the business practices of suppliers or who engage in questionable supplier practices face being punished by consumers, a study has claimed.
The survey of more than 1,000 typical US consumers, by procurement outsourcing provider Proxima revealed 74 per cent of respondents would be unlikely to buy products or services from a company involved in controversial supplier practices.
Nearly 66 per cent said they would stop giving such a company their business “even if that company was the most convenient and cheapest option”. Even one in three consumers with an income of less than $35,000 (£22,500) a year would spend more money elsewhere to avoid buying from a scandal-ridden company.
Nearly a third of respondents said they would tell friends and family to stop spending their money with a company involved in controversial supplier practices.
Jonathan Cooper-Bagnall, executive vice president and commercial director of Proxima, said when supplier-driven scandals arise “consumers are not drawing a distinction between company and supplier”.
“They are placing as much blame, if not more, squarely at the feet of the company,” he said.
“It is, therefore, critically necessary that companies not only vet suppliers properly before engaging them, but create a monitoring program to catch and address any improprieties before they result in public scandals.”