My Existing Supplier Is More Expensive but Extremely Consistent — How Should Consistency Be Included When Calculating True Raw-Material Cost?

Consistency is a cost line, not a feeling

When a supplier's lots behave the same every time, your goods-in check stays short, your approved wick keeps working, and your reject bin stays nearly empty. When lots vary, you pay for that variation in test candles, re-wicking, cosmetic rejects and time — but those costs are scattered across your workshop and never appear on the supplier's bill. So the cheaper supplier looks cheaper, and the consistent one looks expensive.

The fix is to give consistency a price. Work out, per delivery, what each supplier costs you in materials plus the QC and waste their variation causes. Then compare the totals per candle. That is the true raw-material cost.

One caution before the numbers. "Extremely consistent" has to be a fact from your records, not a reputation. If your existing supplier's consistency is based on memory, start logging it now. That includes us: if you buy from CSI because our wax has behaved well for you, keep the delivery records that prove it, because our pages do not publish lot numbers or tolerances that would prove it for you.

A worked comparison per 25 kg delivery

For illustration, give the consistent supplier the price of Luxury Soy Wax CSI 464. A 25 kg delivery bought as 2 × 10 kg + 1 × 5 kg costs 2 × ₹5,074.00 + ₹2,537.00 = ₹12,685.00, which is ₹507.40 per kg. Give the variable supplier a hypothetical price 10% lower: ₹507.40 × 0.90 = ₹456.66 per kg, so 25 kg costs 25 × ₹456.66 = ₹11,416.50. On the invoice, the variable supplier saves ₹1,268.50 per delivery.

At this series' convention of a 200 g candle at 8% load, 25 kg of wax makes 25,000 ÷ 184 = 135 candles. The candle build used for costing rejects and test candles is 184 g wax, 16 g British Rose at ₹3,068.00 per kg (16 × (₹3,068.00 ÷ 1,000) = ₹49.09), a clear salsa jar at ₹2,950.00 ÷ 100 = ₹29.50, and a thin Eco wick at ₹5.90. Materials per candle: ₹177.85 on the consistent wax (₹93.36 of wax) and ₹168.52 on the cheaper wax (₹84.03 of wax).

Now the consistency costs. The assumptions below are illustrative — replace them with your own records as soon as you have them.

Under these assumptions, the supplier who charges 10% more is ₹1.64 per candle cheaper in true cost, before you count your time, a delayed order or a customer complaint. The variable supplier's invoice saving of ₹1,268.50 is swallowed by ₹1,845.29 of variation costs (₹1,011.12 + ₹379.17 + ₹455.00), against the consistent supplier's ₹355.70.

How big a price premium is consistency worth?

Turn the comparison around and ask what consistency is worth per kilogram. The variable supplier's extra QC and waste cost ₹1,845.29 − ₹355.70 = ₹1,489.59 per delivery more than the consistent supplier's. Spread over 25 kg, that is ₹1,489.59 ÷ 25 = ₹59.58 per kg.

So in this example, the consistent supplier can charge up to ₹59.58 per kg more before the variable one becomes better value. Put another way, the variable supplier would need to price below ₹507.40 − ₹59.58 = ₹447.82 per kg — about 11.7% cheaper, not 10% — just to break even. Any real advantage has to come on top of that.

The same method works the other way. If your records show the cheaper supplier has in fact been steady — two check candles are enough, no re-wicks, rejects at baseline — then the variation lines shrink to match the consistent supplier's, and the 10% saving is real. Consistency is worth paying for only when you can show it exists and the alternative lacks it.

How to measure consistency from your own deliveries

You need a short scorecard kept per delivery, per supplier. Fill it in at goods-in and again after the first production run from that lot. After four or five deliveries, the pattern is usually clear.

Set your own rule for how many deliveries count as evidence. Four or five is a suggested starting point before you label any supplier consistent or variable; fewer than that and one unlucky lot can dominate the picture. Review the scorecards together every quarter, not only when something goes wrong, so that the quiet good deliveries are weighed as carefully as the loud bad ones.

Keep the retained sample from each lot next to the scorecard. When a later delivery looks different, you can compare it with the lot that behaved well rather than with a memory of "how it used to be".

Using consistency in a buying decision

Once you have a few deliveries of data, your true cost per candle for each supplier is simple to state: invoice price per candle plus QC, re-wicking and rejects per candle. Choose on that number, not on price per kg.

Two more factors deserve weight even though they are harder to price. The first is risk concentration: a consistent supplier is still a single point of failure if they run short, which is an argument for qualifying a backup even when your main supplier is excellent. The second is information: a supplier who answers technical questions clearly and quickly shortens every investigation. Ask the same questions of each supplier — lot identification, storage advice, what changed when a lot looked different — and note who gives useful answers. For CSI, those questions go to WhatsApp on +91 7397976926.

If the records show your expensive supplier is consistent and the cheaper one is not, stay put and stop feeling guilty about the price. If they show the difference has disappeared, switch with a pilot. Either way, the decision now rests on evidence rather than on the invoice alone.

Where this page fits

CSI already has guides that cover parts of this question. This page covers the goods-in check for the question above; these go deeper on the rest:

Three things to buy for this job

Frequently asked questions