Vendor Evaluation

Dr. Govinda Bhat S, ASIET, KALADY

Approved Vendor, Quality, Price, Delivery, Vendor Grading, Vendor Relations

This paper describes a very simple & generic model of evaluating the overall performance of approved vendors in respect of an engineering industry. A product consists of thousands of parts and some parts need to be procured from outside vendors based on “Make or buy” decision. Thus manufacturing & vendor development are two sides of the same coin. The vendors of regular inventory are considered for evaluation. A poor performance by even a single vendor will have a telling impact on the production in the company. Hence vendor evaluation/rating assumes significance. This method takes into account five criteria such as Quality, Price, Delivery, Service & Support. The first three are objective in nature & last two are subjective in nature. The provision of negative marks is also indicated here. The overall performance rating is a numerical value. Based on this value, vendors are graded into three categories such as high, mediocre & poor performers. This gives an opportunity for the company management where to focus and also vendors will come to know where they stand & how to improve. This model is widely accepted in mechanical engineering industries. This will ultimately result in good vendor relations which is the need of the hour.
    [1] Robert, Edward & Betty (1991), Industrial Marketing: Analysis, Planning & Control, 2nd edition, Prentice-Hall International, London. [2] R Panneerselvam (2012), Production and Operations Management, 3rd edition, PHI Learning (P) Ltd., New Delhi. [3] H A Mandave & P M Khodke (2010), “Vendor Rating: A Tool for Quality in Supply Chain Management”, The IUP Journal of Supply Chain Management, Vol. VII, No. 3, pp. 40-48, September 2010. [4] Quality System Procedure (QSP) of Kerala Agro Machinery Corporation Ltd, (KAMCO) Athani (An ISO 9001: 2015 Certified Company). [5] Supplier Evaluation, Approval & Review Procedure of BHEL, New Delhi.
Paper ID: GRDCF013005
Published in: Conference : National Conference on Emerging Research Trend in Electrical and Electronics Engineering (ERTE’19)
Page(s): 23 - 25