Assessment and selection of suppliers
Supplier Assessment Criteria
Quality and quality accreditation
Price, cost and cost structure
Delivery
Time
Flexibilty
Service
Systems
Tech and process capability
SCM
Ethical issues
How suppliers respond to change
Volume
Variety
Mix
New Products
Functionality
Cost structure of organization vs Cost of product from supplier
Must be on time
Reduce lead time for organization and cycle time for supplier
varying products
number of products
range of products
Supplier attitude and work ethic
Financial status
Avoid struggling suppliers
Environmental and social responsibility
Supplier's tech skill and overall capability to provide
Must respect its place in supply chain
Supplier selection process
BBBEE
Geographic Location
Exploratory stage/ Pre assessment phase
Selection stage/ Assessment phase
Supplier Management(maintenance)/Post Assessment phase
Identify potential suppliers
Pre-screen to reject unsuitable suppliers
Conduct research on potentially suitable supplier
Choose the assessment method and analyse the suppliers
Select the supplier or suppliers
Ongoing measurement of supplier performance
Supplir accreditation
Use several sources to find info about suppliers
Internet
Credit bureau
Reputation
If supplier does not meet supplier assessment criteria then reject them
Supplier visits
Supplier surveys or questionnaires
Cross functional team visits suppliers
Get first hand info, worker attitude and extensive audit
Supplier provided information = Request for information
Informal
Formal
Semi formal
Executive round table + presentation
Judgement of executives
Weighted AVG performance
USe weighted point evaluation
Approved
Preferred
Certified
highest honor for supplier
Supplier Relationship Management
Transactional
Collaborative
Alliance
Arms length relationship and usually short term
Buyer and seller co-op to achieve cost effectiventss, quality and on time delivery
Same as collaborative BUT existence of institutional,prudent trust.
Mutaully agreed upon
Low value, non-critical purchases
Weight x Scale = score
Meets requirements of selection process
Consistently meet required levels of service
Cost reduction
Delivery
Quality