In all areas of business, every industry faces specific risks, and the rice industry is no exception. In this article, we present the 5 most serious risks when choosing an unreliable, quality rice export unit.
Risk 1: Rice supplied without quality assurance
In the process of exporting rice, the basic rice quality inspection process is a crucial step. The inspection process includes the following steps:
- Step 1: Prepare rice product samples for testing and establish testing criteria.
- Step 2: Send the samples to the testing center designated by the Ministry of Health.
- Step 3: Receive the results of the rice quality testing.
This is the basic process, but not all companies adhere to this procedure. This can lead to rice becoming contaminated with diseases, mold, or pests during transportation. These substandard rice products directly harm the reputation of the rice importer.
Image of rice infested with termites because the production company did not ensure the sterilization process
Risk 2: Delivery delays
Unprofessional rice export companies always have problems during delivery time. Incidents may include:
- Slow preparation of the shipment
- Delivery delays
- Late provision of required documents
- Uncertainty regarding delivery times in the contract, etc.
It is essential to note that if the delivery time is not committed to, there is no guarantee that the goods will arrive as planned. Consequently, this can be an indicator of the company's lack of professionalism and reliability. The most serious consequence of this second risk is that you may face order cancellations or have to compensate for contract breaches. At the same time, damages your brand's reputation, indirectly benefiting your competitors.
Risk 3: Lack of customer protection policies
In product and service businesses, unwanted risks often occur for both companies and customers. Some risks that may arise include:
- Product losses: This issue usually occurs with transportation partners and is a risk that the company passively faces and does not desire. However, it still significantly affects customers.
- Uncontrollable risks: Bad weather causing rice transport ships to sink, rice theft, etc. These unforeseeable risks are rare but, to ensure the best outcome, you should verify the company's solutions to address such issues.
- Price fluctuations: Rice market prices are constantly changing, and sometimes the current market price may be lower than the price you agreed upon with the company. Reputable companies will be understanding and open to renegotiating the best price for you.
- Product quality: Apart from subjective factors, there are various objective factors affecting rice quality. However, these can be acceptable and come with the exporting company's responsibility.
These risks are not exhaustive, but regardless of the nature of the risk, they all have varying impacts on the rice importer. Therefore, if the company you are considering does not have customer protection policies, you should quickly seek another company to maximize your rights and benefits.
Risk 4: Loss of trust from partners and customers
All the risks and errors mentioned above can lead to tension in the transaction process. You will not only feel anger and frustration due to the poor product quality but also face significant pressure from partners and customers demanding order cancellations. This affects the reputation of your brand, something you have spent a lot of time and effort building.
Anxiety when facing requests to cancel orders from customer partners
Risk 5: Financial losses
When orders do not go as planned, your business will face financial losses, including:
- Costs of disposing of low-quality rice: Substandard products require costly disposal processes.
- Legal costs: Facing lawsuits or compensation claims from partners or customers typically come with high expenses.
- Loss due to reputation damage: When a contract is broken, a damaged reputation directly impacts your market share and long-term financial losses.
- Rebuilding reputation: Restoring a tarnished reputation requires significant time and resources. This affects your business's growth and profit.
- Sustainability: Continual product risks threaten your business's existence and entire operational system.
- Therefore, to avoid financial losses and the mentioned risks, it is essential to thoroughly research and have clear strategies to ensure a consistent supply of high-quality and reputable rice.
To conclude
Choosing the right rice export company plays a crucial role in protecting your rights and interests in the rice export business. It ensures not only product quality but also addresses unwanted risks in this industry. Choosing an unreliable rice export unit can lead to a series of risks, from low product quality to damaged reputation, financial loss and threats to business sustainability.
To ensure the best outcome, thoroughly understand and apply the five critical criteria when selecting a rice export company. This guarantees that you can establish a reliable relationship with partners and customers, protect your business's reputation, and maintain sustainability in the rice export industry.
