‘Are you a manufacturer or a trader?’


This is a question we have heard a million times, and no we are not exaggerating! This is the very first question potential clients we approach or have approached us shoot and we believe almost everyone in the industry has to answer it.
Well, we all know the textbook definitions of both, and we don’t aim to explain the same either.
Manufacturing and trading, both have their upsides and downsides. The Chinese symbol yin yang perfectly sums up both.
In order to find out how our clients felt, we decided to ask them the pros and cons of both and the answers we received further confirmed the belief we had regarding the same question.
Companies usually go to a manufacturer when bulk quantities are involve. A manufacturer can provide huge quantities of material at lower costs. It is because the need for the trader to act as the middleman is eliminated and hence eliminates the additional costs, they would pay to them. They generally specialize in manufacturing of a particular product. Hence, manufacturers bring distinct knowledge and experience to the table. They have engineering expertise related to these products and they have the technical know-how on complex drawings and requirements related to the product. A very underrated advantage of this how much it helps procurement officers determine the right product for their requirements.
Apart from lower cost-large quantity being a manufacturer’s ultimate selling point, quality also plays a pivotal role. Most manufacturers and their manufacturing facility are also accredited with quality certifications by reputed laboratories, making them reliable. They adhere to the respective standards and are strictly within tolerances and dimensions. They are independent and in control of their own production process which is an advantage compared to traders who are reliant on manufacturers.
Manufacturing does have certain disadvantages though. A manufacturer loses out on clients due to their inability to give credits. A manufacturer incurs high capital and labor expenditure and giving credits can become difficult. Customers generally prefer to buy from where they get credit availability and can agree to their credit cycle. A manufacturer also cannot work for orders involving small quantities. They usually work on the factory laid down MOQ’s which are considerable quantities and at times not suitable to customers. Certain manufacturers also cannot go the extra mile meeting every minute demands of a customer like a trader would. Manufacturers also have huge orders piled up; hence clients also face the unpredictability of orders being executed on time.
One of the major drawbacks is the exposure to numerous uncertainties. The raw materials that might be imported faces many fluctuations. There might be currency value fluctuations, or certain tax policy changes or maybe shipping delays which can largely affect pricing of materials. Crisis such as a pandemic like Covid-19 or incidents like Evergreen and Suez Canal also harms manufacturers bringing up costs of raw materials or inhibiting their production process resulting in complete halt. This results in delays of already placed orders and high inconvenience for customers and their projects.
Traders, the best way to describe a trader would be, they are someone who are Masters of all Trades and Jack of None. Customers who have requirements for various material at the same time generally go to a trader. One can find all material under one roof, and this is highly convenient when procuring. A manufacturer more often that not, focuses on a particular product only and clients cannot approach them for all their requirements. A trader also has an extensive network involving other vendors because of which they can arrange host of different materials easily. They also willingly work on small quantities, and this makes them favorable since shutdown or maintenance requirements for plants do not involve huge quantities.  Traders also facilitate credit cycles as per customer’s requirements and this gives them an upper hand since most companies run a budget cycle for their projects.
Normally, traders are also stockiest. During crisis like the current pandemic, manufacturers had to halt their production because of rising number of cases. Whereas traders could still continue to operate, and customers would engage with them for their material requirements due to ready availability of materials. Another major edge traders have is the fact that they are eager to meet all small demands of the customer. They make work for the customer very easy and smooth.
Traders do have their fair share of cons too. They might be the jack of all, but they still are the masters of none. They might have knowledge on a wide array of products, but they do not major in any and cannot provide great depths for a particular product. Traders have no control over costing either. They are reliant on other manufacturers for products and cannot control the fluctuations in prices. Customers also may not approach traders when huge quantity of materials are required. They can cut the cost of a trader and directly procure from a manufacturer. Traders are in much less control in comparison to a manufacturer and this harms them in the long run.
Now, that we have gone through the yin yang of both, lets circle back to the million dollar question. Are we manufacturers or traders?
We answer by asking the following question ‘What do you want us to be?’. This may come as a shock to some, but we have our reasons for it.
Therefore, here at TSI, we have the belief that we are traders and manufacturers both and will be what our customers ask us to be. We have experienced being both and know how to be the best of both the worlds. We aim to achieve perfection and we believe this is the stride forward.
We answer by asking the following question ‘What do you want us to be?’. This may come as a shock to some, but we have our reasons for it.
We have come from a background of trading, having been one for a number of years. Our transition from traders to manufacturers taught us how to make the best of both the world’s.
Our ideologies are shaped around quality. We consider it to be quintessential to our business and how we want our company to be know for. Our quality control, quality assurance, quality check is stringent than most manufacturers. From the inspection of the raw material to the packaging of the end product, our team assures checks and testing are performed throughout. The apt standard is followed, the tolerances and dimensions are under control and quality is not compromised. We go to lengths a trader generally would not and that distinguishes us from others. We follow the protocols a manufacturer would follow, even for the smallest quantity.
We have a laid down quality assurance plan which is followed for all orders, our quality team makes sure checks are performed at every stage. Our testing criteria confirms every material manufactured or supplied is within tolerances and dimensions. Our aim is to help our customer relax once they place order and let us do the job from raw material check to dispatch of material.
We have a team, that is highly competent and have the required knowledge and technical know-how just like a manufacturer would have. As a company, we have a comprehensive network in the local, domestic as well as the international market. We are in regular contact with manufacturers around the world and procure material for our clients as well as the local market. Due to our experience and grasp of the industry, we buy material at low and affordable costs and of the required quality. We have handled and supplied huge quantities of materials for various projects at costs a manufacturer would provide. We are also independent, irrespective of the material, we can provide the best quality material at the most competitive prices.
Profits our not our motto but providing services is. Therefore, we work on every kind of quantity, small or huge. We also are more than happy to go the extra mile and provide every small service to our clients. Our business principles are customer centric and revolve around quality. We like to put our clients on a pedestal and consider them to know the best.
Therefore, here at TSI, we have the belief that we are traders and manufacturers both and will be what our customers ask us to be. We have experienced being both and know how to be the best of both the worlds. We aim to achieve perfection and we believe this is the stride forward.

Trilok Steel Industries