Vendor rating Vendor Rating A vendor is any
- Slides: 10
Vendor Rating ? A vendor is any person or company that sells goods or services to someone else in the economic production chain. Vendors or suppliers are given standing, status, or title according to their attainment of some level of performance, such as delivery, lead time, quality, price, or some combination of variables. It may take the form of a hierarchical ranking from poor to excellent and whatever rankings the firm chooses to insert in between the two.
For some firms, it may come in the form of some sort of award system or as some variation of certification. It is a direct result of the widespread implementation of the just-in-time concept.
Objectives To help the buyer in future selection To provide buyer with the information helpful in subsequent negotiation To provide the buyer with the important information which he can act upon any corrective measure
Advantage of vendor rating Helping minimize subjectivity in judgment and make it possible to consider all relevant criteria in assessing suppliers. Providing feedback from all areas in one package. Facilitating better communication with vendors. Providing overall control of the vendor base. Requiring specific action to correct identified performance weaknesses. Establishing continuous review standards for vendors, thus ensuring continuous improvement of vendor performance.
Inexperience with Products and Services Unfamiliarity With Corporate Operations Disadvantage of vendor rating Resistance Within Company Threat to Security
Vendors are rated on the basis of various characteristics: Time delivery Quality Price Service How vendors are rated Market information credit terms Installation cost Co operation Delivery charges Others actors such as
CATEGORICAL PLAN: • This is a very subjective method. • Mangers from concerned department prepare list of factors important from their views Methods of vendor rating • Each of the major supplier is evaluated against each evaluator’s list of factors evaluation is done in the terms of Good Satisfactory Poor Neutral Preferred
WEIGHTED POINT PLAN The buyer decides on Methods of vendor rating 1. Performance factor to be evaluated(Quality, delivery, price and service) 2. Weightages for each factor 3. The vendor performance in respect of each factor
CRITICAL INCIDENT METHOD Its based on buyers and vendors relationship CHECKLIST SYSTEM Methods of vendor rating Simple checklist Reliability Technical capabilities After sales service Availability Sales assistance