In the spring of 1852, Ulysses S. Grant's regiment, with him as quartermaster, was ordered to California via Panama. The last twenty-five miles of the trip across the Isthmus had to be made by mule-train.
"A contract had been entered into with the steamship company in New York for the transportation of the regiment to California, including the Isthmus transit...But when we reached Cruces there was not a mule, either for pack or saddle, in the place. The contractor promised that the animals would be on hand in the morning. In the morning he said that they were on the way from some imaginary place, and would arrive in the course of the day. This went on until I saw that he could not procure the animals at all at the price he had promised to furnish them for...I therefore myself dismissed the contractor and made a new contract with a native, at more than double the original price." Ulysses S. Grant
LESSON: A supplier who can't deliver as promised is not worth dealing with at any price. If you make price your only consideration, it will almost certainly cost you more in the end. Contracts with suppliers should include performance standards as well as penalty and exit provisions for failure to meet those standards.
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